Annual Securities Report(Report stipulated under Article 24, Paragraph 1 of the
Financial Instruments and Exchange Act)
From January 1, 2023
206th Fiscal YearTo December 31, 2023

1-9-9 Yaesu, Chuo-ku, Tokyo

Tokyo Tatemono Co., Ltd.
(E03859)

206th Fiscal Year (January 1, 2023 to December 31, 2023)

Annual Securities
Report1 This document is an English translation of the Annual Securities Report filed
pursuant to Article 24, Paragraph 1 of the Financial Instruments and ExchangeAct, with the table of contents and pages of data submitted on March 27, 2024,
using the Electronic Disclosure for Investors’ NETwork (EDINET) set forth in
Article 27-30-2 of said Act.
2 Appended to the end of this document are English translations of the Auditor’sReport that was attached to the Annual Securities Report when it was filed using
the aforementioned method, and the internal control report and confirmation
letter filed at the same time as the Annual Securities Report.
3 This document has been translated from the Japanese original for reference
purposes only. In the event of any discrepancy between this translated document
and the Japanese original, the original shall prevail.

Tokyo Tatemono Co., Ltd.

Table of contents
Page
Annual Securities Report for 206th Fiscal Year (January 1, 2023, to December 31, 2023)
Cover ......................................................................................................................................................................................................... 1
Part I: Corporate Information .................................................................................................................................................................... 2
I. Corporate Overview ........................................................................................................................................................................... 2
1. Key Management Indicators, etc. .................................................................................................................................................. 2
2. Corporate History .......................................................................................................................................................................... 4
3. Description of Business ................................................................................................................................................................. 6
4. Subsidiaries and Affiliated Companies .......................................................................................................................................... 8
5. Employees ................................................................................................................................................................................... 11
II. Business Overview ......................................................................................................................................................................... 14
1. Management Policy, Business Environment and Management Issues to be Addressed .............................................................. 14
2. Disclosure of Sustainability-related Financial Information ......................................................................................................... 18
3. Business Risk and Other Risk Factors ......................................................................................................................................... 26
4. Management Analysis of Financial Position, Operating Results and Cash Flows ....................................................................... 29
5. Material Agreements, etc. ............................................................................................................................................................ 36
6. Research and Development ......................................................................................................................................................... 36
III. Property and Equipment ................................................................................................................................................................ 37
1. Summary of Capital Investment .................................................................................................................................................. 37
2. Major Property and Equipment ................................................................................................................................................... 38
3. Plans for Capital Investment, Disposals of Property and Equipment, etc. ................................................................................... 42
IV. Information on the Company......................................................................................................................................................... 43
1. Information on the Company’s Stock, etc. .................................................................................................................................. 43
2. Information on Acquisition, etc. of Treasury Shares ................................................................................................................... 49
3. Dividend Policy ........................................................................................................................................................................... 50
4. Status of Corporate Governance, etc. .......................................................................................................................................... 51
V. Financial Information ..................................................................................................................................................................... 85
1. Consolidated Financial Statements .............................................................................................................................................. 86
2. Non-Consolidated Financial Statements .................................................................................................................................... 138
VI. Stock-Related Administration for the Company ......................................................................................................................... 158
VII. Reference Information on the Company .................................................................................................................................... 159
1. Information on the Parent Company .......................................................................................................................................... 159
2. Other Reference Information ..................................................................................................................................................... 159
Part II: Information on Guarantors, etc. for the Company ..................................................................................................................... 161

Independent Auditor’s Report .............................................................................................................................. End of this document
Internal Control Report ........................................................................................................................................ End of this document
Confirmation Letter .............................................................................................................................................. End of this document

CoverDocument Filed:Annual Securities Report (“Yukashoken Hokokusho”)

Clause of stipulation:

Article 24, Paragraph 1 of the Financial Instruments and Exchange Act

Filed to:Director-General of Kanto Local Finance Bureau

Filing Date:

March 27, 2024

Fiscal Year:

206th Fiscal Year (from January 1, 2023 to December 31, 2023）

Company Name:Tokyo Tatemono Kabushiki Kaisha

Company Name in English:

Tokyo Tatemono Co., Ltd.

Title and Name of Representative:

Hitoshi Nomura, Representative Director, President and Chief Executive Officer

Address of Registered Head Office:1-9-9 Yaesu, Chuo-ku, Tokyo(Above is the address registered as the location of the head office of the Company.
Actual business operations are conducted at the “Nearest Place of Contact.”)

Telephone Number:+81-3-3274-0111 (Representative)

Name of Contact Person:

Yusuke Mishima, Managing Officer, General Manager of Accounting Department

Nearest Place of Contact:

1-4-16 Yaesu, Chuo-ku, Tokyo

Telephone Number:+81-3-3274-0111 (Representative)

Name of Contact Person:

Yusuke Mishima, Managing Officer, General Manager of Accounting Department

Place for Public Inspection:

Tokyo Tatemono Co., Ltd. Kansai Branch(3-4-8 Honmachi, Chuo-ku, Osaka-shi, Osaka)
Tokyo Stock Exchange, Inc.
(2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)

1

Part I: Corporate Information
I. Corporate Overview
1. Key Management Indicators, etc.
(1) Consolidated Management Indicators
Fiscal Year

202nd

Year-End

203rd

204th

205th

206th

December 2019 December 2020 December 2021 December 2022 December 2023

(Millions ofyen)(Millions of
Ordinary profityen)Profit attributable to owners (Millions ofof parentyen)(Millions ofComprehensive income
yen)(Millions of
Net assets
yen)(Millions of
Total assets
yen)
Net assets per share(yen)
Operating revenue

323,036

334,980

340,477

349,940

375,946

44,61147,072

46,27063,531

69,471

29,796

31,79534,96543,06245,084

46,402

24,49038,89841,616

67,511

384,211399,129427,661456,838

508,035

1,564,049

1,624,640

1,650,770

1,720,134

1,905,309

1,794.15

1,862.81

1,996.52

2,135.08

2,378.61

141.59152.12167.35206.15215.82

Profit per share(yen)

Diluted earnings per share

(yen)

－

－

－

－

－

Shareholders’ equity ratio

(%)

24.0

24.0

25.3

25.9

26.1

Return on equity

(%)

8.2

8.3

8.7

10.0

9.6

Price earnings ratio(times)
12.1
9.3
10.0
7.8
9.8
Cash flows from operating (Millions of
24,096
43,52465,889(3,332)
20,588activities
yen)
Cash flows from investing (Millions of(64,082)(66,724)(1,642)(21,204)(54,069)
activities
yen)
Cash flows from financing (Millions of
48,00038,307(32,187)
18,421
77,908activities
yen)
Cash and cash equivalent at (Millions of
39,49754,64587,00882,439127,303end of periodyen)
Number of employees
5,396
5,344
5,648
5,878
4,661
(persons)[Average number of part[5,440][5,070][4,782][4,687][4,525]time employees, etc.](Note) 1. Diluted earnings per share is not shown because there are no potential shares.
2. The Company has introduced a Board Benefit Trust (BBT) from the 201st fiscal year, and the Company shares held by
the trust, which are recorded as treasury shares in shareholders' equity, are included in treasury shares, which isdeducted from the number of shares issued and outstanding at the end of the period for the calculation of net assets per
share. For the profit per share calculation, these shares are included in treasury shares, which are deducted during the
calculation of average number of common shares during the period.
3. The “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29; March 31, 2020) and other related
accounting standards have been applied from the beginning of the 205th fiscal year, and the key management indicatorsand other items for the 205th fiscal year and thereafter are those after the application of said accounting standard andothers.

2(2) Management Indicators of the Company
Fiscal Year

202nd

Year-End

204th

205th

206th

December 2019 December 2020 December 2021 December 2022 December 2023

(Millions ofyen)(Millions of
Ordinary profit
yen)(Millions ofProfityen)(Millions ofShare capitalyen)
Total number of shares issued(shares)(Millions of
Net assets
yen)(Millions of
Total assets
yen)
Net assets per share(yen)
Operating revenue

Dividend amount per share(Interim dividend paid pershare)
Profit per share

203rd

(yen)
(yen)

199,931210,283

219,005

217,383

229,645

34,12041,69447,45047,50949,23525,97130,02525,56432,02332,26492,451

92,451

92,451

92,451

92,451

216,963,374

209,167,674

209,167,674

209,167,674

209,167,674

379,325

392,317406,956

425,708

460,859

1,351,283

1,456,329

1,474,985

1,543,513

1,712,838

1,814.81

1,876.94

1,948.17

2,037.96

2,206.09

41.00

46.00

51.00

65.00

73.00

(19.00)(22.00)(24.00)(29.00)(36.00)123.41143.65122.35

153.30154.45

Diluted earnings per share

(yen)

－

－

－

－

－

Shareholders’ equity ratio

(%)

28.1

26.9

27.6

27.6

26.9

Return on equity

(%)

7.0

7.8

6.4

7.7

7.3

Price earnings ratio(times)

13.8

9.9

13.7

10.4

13.7

Dividend payout ratio

(%)

33.2

32.0

41.7

42.4

47.3

655

677

725

760

807

[62]

[74]

[87]

[95]

[100]

153.5

131.8

159.5

158.1

209.5

(118.1)(126.8)(143.0)(139.5)(178.9)

(yen)

1,740

1,828

1,852

2,190

2,191

(yen)

1,078

904

1,367

1,569

1,484

Number of employees[Average number of part-time
employees, etc.]
Total shareholder return(Benchmark: TOPIX incl.
dividends)
Highest share price
Lowest share price(persons)(%)(Note) 1. Diluted earnings per share is not shown because there are no potential shares.
2. The highest and lowest share prices are market prices on the Tokyo Stock Exchange (Prime Market) from April 4, 2022,
and prior to that are market prices on the Tokyo Stock Exchange (First Section).
3. The Company has introduced a Board Benefit Trust (BBT) from the 201st fiscal year, and the Company shares held by
the trust, which are recorded as treasury shares in shareholders’ equity, are included in treasury shares, which isdeducted from the number of shares issued and outstanding at the end of the period for the calculation of net assets per
share. For the profit per share calculation, these shares are included in treasury shares, which are deducted during the
calculation of average number of common shares during the period.
4. Pursuant to a resolution of the Board of Directors meeting held on January 20, 2020, the Company cancelled 7,795,700
shares of treasury shares as of January 31, 2020. Accordingly, the total number of issued and outstanding shares
decreased by 7,795,700 shares in the 203rd fiscal year.
5. The “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29; March 31, 2020) and other related
accounting standards have been applied from the beginning of the 205th fiscal year, and the key management indicatorsand other items for the 205th fiscal year are those after the application of said accounting standard and others.

32. Corporate History
Founded on October 1, 1896, with a capital of ¥1,000,000 by Zenjiro Yasuda and others, the Company began operations withgeneral real estate business and real estate collateralized loans as its main businesses. Subsequently, the Company established abranch in Yokohama as well as branches and sub-branches overseas but was severely affected by the ending of World War II,
including the loss of all of its overseas assets.
Postwar, the Company concentrated on the building leasing business and expanded its operations to include residential sales,
brokerage, appraisal, and consulting, thereby establishing itself as a comprehensive real estate company. In recent years, theCompany has expanded its Parking business, Leisure business, Asset Management business, and Overseas businesses, as wellas promoting several large-scale redevelopment projects.
An outline of the transition to date is as follows.
October 1896
October 1896

Tokyo Tatemono is established (Head office located at 18 Gofuku-cho, Nihonbashi, Tokyo)
Commence real estate sales and purchases through installment plans, which are the earliest form of residential
loans.
November 1896 Opens Yokohama Branch (reorganized to Yokohama Sales Office, Property Management Department II in
January 2000, abolished in November 2022)
March 1903
Opens Tianjin Branch (abolished in August 1945)
September 1907 Listed on the former Tokyo Stock Exchange
August 1928
Begins sales of land for residence in Sekiguchidaimachi
November 1929 Head office relocate to Tokyo Tatemono Building (Former Tokyo Tatemono Head Office Building)June 1947
Opens Osaka Service Office (Current Kansai Branch)
May 1949
Re-listed on the Tokyo Stock Exchange
September 1952 Obtains building lots and buildings transaction business license
March 1956
Registered as a first-class architect officeNovember 1956 Establishes Tokyo Fudosan Kanri Co., Ltd. (A consolidated subsidiary as of March 2013)
March 1958
Completes extensions and renovations at head office building of Tokyo Tatemono. Formalizes Commercial
Properties business postwar
October 1959
Establishes Tokyo Real Estate Cleaning Co., Ltd. (Current Tokyo Building Service Co., Ltd.) (A consolidated
subsidiary as of March 2013)
August 1962
Establishes Totate Shoji Co., Ltd. (Current Tokyo Tatemono Amenity Support Co., Ltd.)
August 1963
Starts residential land development in Nakagawara, Fuchu City. Formalizes Residential business postwar
June 1964
Opens Shinjuku Service Office (Current Shinjuku Sales Office, Property Management Department II)
March 1965
Registered as a real-estate appraiser
September 1968 Starts sales of condominiums in Fujisawa City
February 1974 Obtains approval for special construction business
November 1979 Completes Shinjuku Center Building
May 1980
Commencement of operations, Totate Housing Services Co., Ltd. (Current Tokyo Tatemono Real Estate Sales
Co., Ltd.) (Wholly owned subsidiary as of July 2015)
November 1984 Establishes Kyodo Building Management Co., Ltd. (Current Tokyo Tatemono Investment Advisors Co., Ltd.)
June 1987
Establishes Kawaguchiko Resort Development Co., Ltd. (Current Tokyo Tatemono Resort Co., Ltd.)
November 1987 Opens Sapporo Service Office (Promoted to Sapporo Branch in October 1992, abolished in March 2021)
November 1995 Permission for real estate specified joint enterprise law
November 1998 Obtains first registration in Japan for the SPC Act (Current Act on Securitization of Assets)
April 2000
Establishes Tokyo Realty Investment Management, Inc. (A consolidated subsidiary as of December 2016;
became a wholly owned subsidiary as of April 2023)
February 2001 Establishes E-State Online Co., Ltd.
October 2002
Opens Fukuoka Branch (Current Kyushu Branch)
April 2003
Unifies condominium brands into “Brillia”
October 2005
Opens Nagoya Branch
October 2005
Establishes PRIME PLACE Co., Ltd.
November 2006 Establishes Tokyo Tatemono (Shanghai) Real Estate Consulting Co., Ltd.
September 2007 Completes Kasumigaseki Common Gate
November 2008 Opens SMARK Isesaki
February 2011 Acquires shares of Nihon Parking Corporation (A consolidated subsidiary; became a wholly owned subsidiary
as of June 2011)
May 2012
Completes Nakano Central Park
March 2013
Completes Tokyo Square Garden
October 2013
Completes Brillia Tama New Town
February 2014 Establishes Tokyo Tatemono Asia Pte. Ltd.
April 2014
Completes The Otemachi Tower

4

March 2015
March 2017
May 2020
May 2020
August 2021
October 2023

Completes Brillia Tower Ikebukuro, Japan’s first high-rise condominium integrated with a main governmentbuilding
Acquires additional shares of Seishin Service Co., Ltd. (A consolidated subsidiary; became a wholly owned
subsidiary as of December 2019)
Head office relocate to Tokyo Tatemono Yaesu Building
Completes Hareza Tower
Acquires shares of EXPERT OFFICE Co., Ltd. (A consolidated subsidiary; became a wholly owned subsidiary
as of January 2022)
Establishes Tokyo Tatemono US Ltd.

5

3. Description of Business
The main businesses of the Group, which consists of the Company, its 66 subsidiaries and associates (including 32 consolidated
subsidiaries and 22 entities accounted for using equity method), as well as the names and positions of major companies in thesebusinesses, are as follows. The classification of each business is the same as that of the segment information described in “(1)Notes to Consolidated Financial Statements (Segment Information)” of “1. Consolidated Financial Statements” under “V.
Financial Information.”(1) Commercial Properties Business
The Company is engaged in developing, selling, leasing, and operating office buildings, retail facilities, logistics properties, etc.
Consolidated subsidiaries, Tokyo Tatemono Resort Co., Ltd., Meieki 2-chome Kaihatsu Tokutei Mokuteki Kaisha, the silent
partnership operated by Tokyo Prime Stage Y.K., and three other companies, along with an entity accounted for using equity
method, Kasumigaseki Kaihatsu Tokutei Mokuteki Kaisha, operate the leasing and management of office buildings, etc.
Consolidated subsidiaries, Tokyo Fudosan Kanri Co., Ltd., Shinjuku Center Building Management Co., Ltd., Tokyo Building
Service Co., Ltd., and Seishin Service Co., Ltd., operate building management.
Consolidated subsidiary EXPERT OFFICE Co., Ltd. operates serviced offices and coworking spaces.
Consolidated subsidiary PRIME PLACE Co., Ltd. manages and operates retail facilities.
(2) Residential Business
The Company is engaged in developing, subdividing, selling, and leasing condominiums and other residential properties.
Tokyo Tatemono Amenity Support Co., Ltd., a consolidated subsidiary, undertakes the management of condominiums, etc.
The Company and its consolidated subsidiary Kachidoki GROWTH TOWN Co., Ltd., operate the leasing and management ofcondominiums.
E-State Online Co., Ltd., a consolidated subsidiary, and two other companies provide services related to web promotions forsales of condominiums, etc.
(3) Asset Service Business
Consolidated subsidiary Tokyo Tatemono Real Estate Sales Co., Ltd. engages in real estate transactions and provides brokerageand consulting services.
Consolidated subsidiary Nihon Parking Corporation develops and operates parking facilities, among other businesses.
(4) Other Business(Leisure Business)
Consolidated subsidiary Tokyo Tatemono Resort Co., Ltd. operates hotels, resort facilities, deluxe bathing facilities, and golfcourses.
The Company and its consolidated subsidiary Kawaguchiko Country Club Inc., operate golf courses.
(Asset Management Business)
Consolidated subsidiary Tokyo Tatemono Investment Advisors Co., Ltd. engages in real estate investment consulting and realestate fund business formation and management.
Tokyo Realty Investment Management, Inc., a consolidated subsidiary, operates an asset management business for investment
corporations as an asset management company under the Act on Investment Trusts and Investment Corporations.
(Overseas Businesses)
The Company and its consolidated subsidiaries, Tokyo Tatemono Asia Pte. Ltd. and Tokyo Tatemono US Ltd. are engaged inreal estate development and other businesses in China, Southeast Asia and the United States through two consolidated
subsidiaries and 16 entities accounted for using equity method.
Tokyo Tatemono (Shanghai) Real Estate Consulting Co., Ltd., a consolidated subsidiary, operates a real estate consulting
business in China.
(Other）
The Company provides real estate appraisals.
The following is the business structure diagram which illustrates the matters explained above.

6

(Chart of business structure)7

4. Subsidiaries and Affiliated Companies
Relationship

Name

Address

Share capitalor
Investments
In Capital(Millions ofyen)

Principal
Business(Note) 1

Percentage
of Voting
RightsIndirect
Owned or
(%)
Held
(%)

Holding
Positions of
Officer(s)(Note) 2
Company Company

Fund Transactions,etc.
(Millions of yen)

Business
Transactions

Lease of
Facilities－

Leasedofficespacefrom theCompany－

Leasedofficespacefrom theCompany－

Leasedofficespacefrom theCompany

Officer(s) Employee(s)(person)(person)(Consolidated Subsidiaries)

Tokyo Tatemono Real
Estate Sales Co., Ltd.

Tokyo Tatemono ResortCo., Ltd.

Chuo-ku, Tokyo

Chuo-ku, Tokyo

Tokyo Tatemono Amenity
Chuo-ku, Tokyo
Support Co., Ltd.

Tokyo Tatemono
Investment
Advisors Co., Ltd.

Chuo-ku, Tokyo

E-State Online Co., Ltd.

Chiyoda-ku,
Tokyo

4,321

100

Asset
Servicebusiness

Commercial
Properties
business,
Otherbusiness

100

Residential
business

100.0

－

2

3

100.0

－

1

1

－

－

－

－

－

－

－

Kawaguchiko Country
Club Inc.

Fujikawaguchiko-machi,
Yamanashi Pref.

10

Other
business

Shinjuku Center Building
Management Co., Ltd.

Shinjuku-ku,
TokyoNihon Parking
Corporation

Chiyoda-ku,
Tokyo

5

Short-termborrowings (Note) 3
2,764
Short-term loans
receivable (Note) 3
1,040
Long-term loans
receivable (Note) 3.
13,185
Short-termborrowings (Note) 3
1,934
Long-term
borrowings (Note) 3
3,500

200

100

Shanghai,
People’sRepublic of
China

2

3

Other
business

Chuo-ku, Tokyo

Tokyo Tatemono(Shanghai) Real EstateConsulting Co., Ltd.

－

2

Residential
business

PRIME PLACE Co., Ltd.

Chuo-ku, Tokyo

100.0

－

100

Commercial
Properties
business

Kachidoki GROWTHTOWN Co., Ltd.

100.0

Short-term loans
receivable(Note) 3
18,119

100.0

100.0

100.0

－

－

－

2

1

－

8

6

5

Short-termborrowings (Note) 3
3,091

Outsourcing
Short-term
servicesborrowings (Note) 3 related to
614 webpromotion
Outsourcing
operation
Short-term
andborrowings (Note) 3
management
1,411
of retailfacilities

100

Residential
business

100.0

－

－

2

Short-termborrowings (Note) 3
506
Short-term loans
receivable (Note) 3
400
Long-term loans
receivable (Note) 3
1,850

million
RMB
7

Other
business

100.0

－

1

3

－

30

Commercial
Properties
business

100

Asset
Servicebusiness

100.0

100.0

8

－

－

－

2

4

4

－

Outsourcing
commercial
Short-term
properties
borrowings (Note) 3
management
911
and cleaning
services
Short-termborrowings (Note) 3
1,547
Short-term loans
receivable (Note) 3－
1,188
Long-term loans
receivable (Note) 3
5,486

Leasedofficespacefrom theCompany
Leasedofficespacefrom theCompany
Leasedofficespacefrom theCompany

Leasedofficespacefrom theCompany

Leasedofficespacefrom theCompanyRelationship

Name

Address

Share capitalor
Investments
In Capital(Millions ofyen)

Principal
Business(Note) 1

Percentage
of Voting
RightsIndirect
Owned or
(%)
Held
(%)

Holding
Positions of
Officer(s)(Note) 2
Company Company

120

76.0

－

3

5

Sumida-ku,
Tokyo

50

Commercial
Properties
business

100.0

57.7

1

2

Meieki 2-chome Kaihatsu
Chiyoda-ku,
Tokutei Mokuteki Kaisha
Tokyo(Note) 4.

12,700Commercial
Properties
business

－

－

－

－

The silent partnership
operated by Tokyo Prime
Stage Y.K.
(Note) 4.

54,897

Commercial
Properties
business

－

－

－

－

Tokyo Building Service
Co., Ltd.

Chiyoda-ku,
Tokyo

9

Lease of
Facilities

Outsourcing
Short-termcommercial
borrowings (Note) 3 properties
15,395 management
services
Short-term
Outsourcing
borrowings (Note) 3 commercial
1,848 properties
Long-term
management
borrowings (Note) 3 and cleaning
1,500 services
Operatingandmanaging－
commercial
properties on
consignment
Operatingandmanaging－
commercial
properties on
consignment

Leasedofficespacefrom theCompany(person)Commercial
Properties
business

Sumida-ku,
Tokyo

Business
Transactions

Officer(s) Employee(s)(person)Tokyo Fudosan KanriCo., Ltd.

Fund Transactions,etc.
(Millions of yen)

－

－

－

Relationship

Name

Tokyo Tatemono Asia
Pte. Ltd. (Note) 4

Tokyo Realty Investment
Management, Inc.

Address

Singapore

Chuo-ku, Tokyo

Share capitalor
Investments
In Capital(Millions ofyen)

Principal
Business(Note) 1

Percentage
Holdingof Voting
Positions ofRights Indirect
Officer(s)Owned or(％)
(Note) 2
Held
Company Company(％)

Fund Transactions,etc.
(Millions of yen)

Business
Transactions

Lease of
Facilities－－

Officer(s) Employee(s)(person)(person)

－

3

－

4

Short-termborrowings (Note) 3
255－

Outsourcing
commercial
properties
management
services－

million
SGD
331

Other
business

350

Other
business

100.0

－

2

5

Short-term loans
receivable (Note) 3
6

100.0

－

1

3

Short-term loans
receivable (Note) 3
683

100.0

100.0

－

－

1

Seishin Service Co., Ltd.

Chuo-ku, Tokyo

80

Commercial
Properties
business

EXPERT OFFICE Co.,Ltd.

Chiyoda-ku,
Tokyo

100

Commercial
Properties
business

PT Dharma Tatemono
Property(Note) 4

Indonesia

billions IDR Other
10,951 business

100.0

50.0

－

PT Dharma Tatemono
Residences

Indonesia

billions IDR Other
8,891 business

100.0

50.0

－

Tokyo Tatemono US Ltd.

United States ofAmericamillions
Other
USD
business
0

100.0

－

－

Long-term loans
2 receivable
4,558
Long-term loans
2 receivable
4,706
2

Leasedofficespacefrom theCompany
Leasedofficespacefrom theCompany
Leasedofficespacefrom theCompany

－

－

－

－

－

－

－

Operatingandmanaging
commercial
properties on
consignment

－

－

－

10 other companies(Entities accounted forusing equity method)
Kasumigaseki Kaihatsu
Chiyoda-ku,
Tokutei Mokuteki Kaisha Tokyo

Yangon Museum
Development Pte. Ltd.

Singapore

150

millions
USD
140

Commercial
Properties
business

Otherbusiness

－

－

－

－

－

35.0

35.0

－

2

Guaranteed by theCompany

20 other companies(Notes) 1. Segment names are listed in the “Principal Business” column.
2. Company Employee(s) in the column “Holding positions of Officer(s)” include Managing Officers.
3. Based on the CMS (Cash Management System).
4. Specified subsidiary.

105. Employees(1) Employees within the GroupAs of December 31, 2023
Segment

Number of Employees

Commercial Properties business

1,848[2,281]

Residential business

1,407

[761]

Asset Service business

632

[273]

Other business

652[1,187]Company-wide (common)

122

[23]

4,661

[4,525]

Total(Note) 1. The number of employees is the number of individuals working within our group (excludes individuals seconded fromthe Group to third parties but includes individuals seconded from third parties to the Group). The annual average
number of temporary employees is indicated in brackets.
2. The number of employees listed as “Company-wide (common)” is the number of employees belonging to corporate
departments, etc. that cannot be classified into specific segments.
3. As of the end of the fiscal year under review, the number of employees and the number of temporary employees(average number of people employed) of consolidated companies decreased by 1,217 and 162, respectively, due to thesale of shares of Tokyo Tatemono Kids Co., Ltd. (Other) and Tokyo Tatemono Staffing Co., Ltd. (Other) being excluded
from the scope of consolidation due to the sale of their shares in June 2023 and October 2023, respectively.
(2) Employees of the Company
Number of Employees
807

Average Age[100]

Average Years of Service

41 years10 months

Segment

As of December 31, 2023
Average Annual Salary(thousands of yen)

11 years 4 months

10,235

Number of Employees

Commercial Properties business

307

[37]

Residential business

346

[37]

Asset Service business7[3]

Other business

25

[1]

Company-wide (common)

122

[22]

807

[100]

Total

(Notes) 1. The number of employees is the number of individuals (excludes individuals seconded from the Company but includes
individuals seconded from third parties to the Company). The annual average number of temporary employees isindicated in brackets.
2. The average annual salary includes bonuses and extra wages.
3. The number of employees listed as “Company-wide (common)” is the number of employees belonging to corporate
departments, etc. that cannot be classified into specific segments.
(3) Relationship with Labor Union
The Company’s labor union is outlined below.
Name: Tokyo Tatemono Labor Union
Established: July 21, 1946
Number of members: 405
Relationship with Other Organizations: As a single association and has no relationships with other organizations.
No labor union is established throughout the entire Group.

11(4) Percentage of female workers in management positions, percentage of male workers taking childcare leave, and differences in wages
between male and female workers(i) The Company
FY2023
Percentage of female

Percentage of maleworkers in management
positions (%)

workers taking
childcare leave (%)(Note)1(Note) 2.
9.4

Differences in wages between male and female workers (%) (Note) 3,(Note) 4
All workers

Full-time workers

Part-time and fixedterm temporary
workers

78.1

50.9

58.1

37.1

(Note) 1. Calculated based on the provisions of the Act on the Promotion of Women's Active Engagement in Professional Life
(Law No. 64, 2015), as of December 31, 2023.
2. The above figures are calculated based on the percentage of employees who took childcare leave, etc. as stipulated in
Article 71-4, Item 1 of the Ordinance for Enforcement of the Act on Childcare Leave, Caregiver Leave, and Other
Measures for the Welfare of Workers Caring for Children or Other Family Members (Ministry of Labor Ordinance No.
25, 1991) based on the Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfare of Workers
Caring for Children or Other Family Members (Law No. 76, 1991), and the period covered is from January 1, 2023 to
December 31, 2023.
3. Calculated based on the provisions of the Act on the Promotion of Women's Active Engagement in Professional Life
(Law No. 64, 2015), and the period covered is from January 1, 2023 to December 31, 2023.
4. The salary structure is based on position and performance, and although there is no difference in treatment based on
gender, there are differences in factors such as personnel composition by form of employment and qualification grade.

12

(ii) Consolidated subsidiaries
FY2023Differences in wages between male andfemale workers (%)

Percentage

Nameof femaleworkers in

Percentage of malemanagement
positionsworkers taking
childcare leave (%)(%)(Note)1
Tokyo Tatemono Amenity(Note) 3

All workers

Full-time
workers

Part-timeand fixedterm
temporaryworkers

6.9

25.0(Note) 2

92.0

67.7

91.4

Tokyo Fudosan Kanri Co.,
Ltd.

1.3

42.8

(Note) 2

63.8

76.2

38.6

Tokyo Tatemono ResortCo., Ltd.

5.0

28.6

(Note) 2

78.7

71.5

88.7

Seishin Service Co., Ltd.

3.6

100.0

(Note) 2

80.2

80.2

90.1

13.5

71.4

(Note) 2

62.1

70.7

29.9

Tokyo Building Service
Co., Ltd.

－

－

72.4

73.0

98.7

Parking Support Center
Corporation

8.3

50.0

86.4

81.4

81.1

E-State Online Co., Ltd.

5.3

－

75.5

78.7

95.4

PRIME PLACE Co., Ltd.

18.6

－

54.3

68.2

55.5

Nihon Parking Corporation

5.2

－

21.0

21.9

－

Tokyo Realty Investment
Management, Inc.

6.3

－

－

－

－

Support Co., Ltd.

Tokyo Tatemono Real
Estate Sales Co., Ltd.

(Note) 2(Notes) 1. Calculated based on the provisions of the Act on the Promotion of Women's Active Engagement in Professional Life
(Law No. 64, 2015), as of December 31, 2023.
2. The above figures are calculated based on the percentage of employees who took childcare leave, etc. as stipulated in
Article 71-4, Item 1 of the Ordinance for Enforcement of the Act on Childcare Leave, Caregiver Leave, and Other
Measures for the Welfare of Workers Caring for Children or Other Family Members (Ministry of Labor Ordinance No.
25, 1991) based on the Act on Childcare Leave, Caregiver Leave, and Other Measures for the Welfare of Workers
Caring for Children or Other Family Members (Law No. 76, 1991), and the period covered is from January 1, 2023 to
December 31, 2023.
3. Calculated based on the provisions of the Act on the Promotion of Women's Active Engagement in Professional Life
(Law No. 64, 2015), and the period covered is from January 1, 2023 to December 31, 2023.

13

II. Business Overview
1. Management Policy, Business Environment and Management Issues to be Addressed
The management policy, business environment, and management issues to be addressed by the Group are as follows.
Any forward-looking statement in this document is based on the Group judgments as of the end of the fiscal year under review.
(1) Management Policy(i) Group Long-Term Vision and Medium-Term Business Plan
Aiming for sustainable growth and medium- to long-term enhancement of corporate value, the Group has set forth its longterm vision “Becoming a Next-Generation Developer” for around 2030 and the Group’s Medium-Term Business Plan covering
the period from fiscal 2020 to fiscal 2024. Under our long-term vision, we aim to achieve a consolidated business profit of¥120 billion around 2030 by reaching an overarching balance between “solving social issues” and “growing as a company” aswell as contributing to the achievement of the SDGs. Toward the realization of our long-term vision, the Group Medium-TermBusiness Plan (FY2020-FY2024) aims to achieve the numerical targets for the management indices shown below under “(2)Business Targets” by steadily promoting the following “Five Key Strategies” and an “Evolved Approach to ESG
Management.”
Our Group’s Long-Term Visiona. Key Strategy 1: Promotion of large-scale redevelopment
・ Through reducing environmental impact, strengthening countermeasures against natural disasters, creating a bustling
center of activity, creating a rich community, and creating new value through collaboration with diverse partners and theuse of advanced technology, we aim to realize urban development that contributes to solving social issues and increase
the value of our portfolio of office buildings.
・ The Company will promote several large-scale redevelopment projects, including a redevelopment project involving theformer head office building in front of Tokyo Station, in order to increase stable leasing income.
b. Key Strategy 2: Further strengthening of condominium business・ By continuously capturing opportunities to develop highly competitive condominiums and providing high-quality housingthat responds to social changes, we will further strengthen our for-sale condominium business.

14

・To ensure stable profits, we will continue to pursue large-scale redevelopment and rebuilding projects.
c. Key Strategy 3: Expansion of property sales to investors
・ We aim to achieve continuous profit growth and improve capital efficiency by proactively acquiring development
opportunities for diverse assets that meet real estate investment needs and promoting strategic investments and sales.
・ From the capital efficiency perspective, we will also review our portfolio of non-current assets, considering theirprofitability and future potential.
d. Key Strategy 4: Strengthening of brokerage, fund, and parking businesses
・ We aim to expand the Group-related assets by strengthening the brokerage business, which focuses on increasing the realestate stock, and the Parking business, which caters to the need for effective real estate utilization.
・Through sales of properties developed and held by the Company to REITs or funds sponsored by the Company and others,
the Group AUM will be expanded, and the Fund business is expected to grow.
e. Key Strategy 5: Growth in overseas businesses
・We will continue to promote our long-term business in China and development in other Asian countries.
・Our goal is to increase profits by capturing new business opportunities through collaboration with leading local partners.
f. “Evolved Approach to ESG Management”・ As part of the Group-wide, cross-sectional promotion of sustainability initiatives, the Sustainability Committee and othercommittees will discuss important ESG-related issues, set targets, monitor progress, and evaluate achievements, thereby
ensuring the ongoing development of sustainability initiatives.
・ By utilizing the evaluation items by ESG rating agencies, etc. as a benchmark tool, we aim to be included in ESG indices.
(ii) Materiality
In order to achieve our Long-term Vision, we are aware of the shared value with society to be achieved through our business,
and we have reviewed the material issues to be addressed through backcasting and identified 14 materialities (material issues
that are highly relevant for our business) from the perspectives of social value creation and value creation infrastructure. We
will contribute to realizing a sustainable society by addressing material issues and creating shared value with society throughour business.
Materiality of the Tokyo Tatemono Group15

(2) Management Indicators
Under the Medium-Term Business Plan (FY2020-FY2024), the Group has adopted “consolidated business profit,” which is thesum of consolidated operating profit and share of profit (loss) of entities accounted for using equity method, as its target profit
indicator, and has set a target of “consolidated business profit of ¥75 billion” for FY2024, the final year of the plan.

At the same time, we have set “ROE of 8-10%” as an indicator of capital efficiency in FY2024, and “Debt-equity ratio of
approximately 2.4 times” and “Interest-bearing debt / EBITDA multiple of approximately 12 times” as financial indicators,
aiming to achieve our profit targets while maintaining financial soundness and improving capital efficiency, as well as tooptimize our business portfolio and asset mix.

Interest-bearing debt / EBITDA multiple = interest-bearing debt / (operating profit ＋ interest & dividend income ＋share of profit (loss) of entities accounted for using
equity method ＋ depreciation ＋ goodwill amortization expense)(3) Business Environment and Management Issues to be Addressed
The Japanese economy is expected to continue a recovery trend due to further normalization of economic and social activities
and the recovery of personal consumption and expansion of inbound demand. However, it will be necessary to continue toclosely monitor the impact of high prices, trends in wage increases and interest rates, and the risk of a slowdown in the global
economy, and it seems that a situation of high uncertainty will continue for the foreseeable future.
In the real estate industry, while appropriately addressing the soaring construction costs and the risk of rising interest rates, wemust work to create attractive place value and experience value that attract people as they increasingly seek face-to-faceinteraction and real-life experiences as we enter the post-coronavirus era. In addition, in response to the diversifying needs forwork and living styles triggered by the coronavirus pandemic, we believe it is necessary to continue providing products andservices that meet these needs and to undertake multifaceted efforts towards achieving sustainable urban development.
Under such circumstances, as the Group approaches the final fiscal year of the Medium-Term Business Plan (FY2020 toFY2024), we will make every effort to ensure the steady achievement of this plan by focusing on our key strategies: promotionof large-scale redevelopment, further strengthening of the condominium business, expansion of property sales to investors,
strengthening the brokerage, fund, and parking businesses, growth in oversea businesses, and evolved approach to ESG
management.

16

Against this backdrop, towards the achievement of our Long-term Vision, we will promote efforts related to value co-creationand innovation, well-being, and promotion of a decarbonized, recycling-oriented society, which have been identified as theGroup's materialities. Specifically, in the Yaesu, Nihonbashi, and Kyobashi areas where the Company is implementing several
redevelopment projects, we will operate facilities that support the accumulation of global startup companies and community
building, thus contributing to the creation and growth of startup companies and promoting exchanges with major companies
and venture capitalists, thereby strengthening the innovation ecosystem (Note 1). In addition, in the same area, to achieve officesthat enhance well-being that contribute to productivity improvement and reduction in turnover rates, we will conduct
demonstration experiments using digital technology, among other diverse efforts to enhance the place value and experiencevalue in the area. Furthermore, in order to realize a decarbonized, recycling-oriented society, we will accelerate various
initiatives, such as expanding the development of ZEH and promoting sustainable carbon neutral initiatives using logistics
properties and a self-consignment system (Note 2), which won the 2023 Climate Change Action Minister of the Environment
Award sponsored by the Ministry of the Environment and the Minister of Land, Infrastructure, Transport and Tourism Awardat the 29th Achievement Awards sponsored by the Japan Association for Real Estate Sciences. In response to the urgent issueof soaring construction costs, we will work to mitigate the impact on financial performance by focusing on cost control,
strengthening collaboration with construction contractors, and developing attractive products that are highly appealing, as wellas continuing to make rigorous selection of investments.
Under the Long-term Vision of “Becoming a Next-Generation Developer,” which looks ahead to around 2030, the Group will
steadily achieve the goals of the Group's Medium-Term Business Plan ending in FY2024 and will continue to strive to bothsolve social issues and achieve higher levels of growth as a company through its business, with the aim of becoming a goodcompany for all stakeholders.
(Notes) 1. The business environment is simulated as a natural ecosystem in which various players in industry, academia, andgovernment, including venture companies, large corporations, investors, and research institutions, cluster andcollaborate to create a virtuous cycle that fosters cutting-edge industries and economic growth.
2. Transmission of electricity produced by our own power generation facilities to facilities, etc. elsewhere in ourcompany via a power transmission and distribution network maintained and operated by a general transmission
and distribution company.

17

2. Disclosure of Sustainability-related Financial Information
The Group's disclosure of sustainability-related financial information is as follows. Any forward-looking statement mentioned
below is based on the Group’s judgments as of the end of the consolidated fiscal year under review.
Under our Long-term Vision of “Becoming a Next-Generation Developer,” which looks ahead to around 2030, the Group aims
to both solve social issues and achieve higher levels of growth as a company through its business, and it has also set
contribution to the achievement of the SDGs as a goal. We have identified 14 materialities as issues to be addressed to achievethese goals, and we are implementing various sustainability initiatives that will lead to the resolution of the materialities
through the promotion of key strategies based on the Group's Medium-term Business Plan and an “Evolved Approach to ESG
Management.”
In addition, in order to implement sustainability initiatives throughout the entire Group in a continuous manner, we haveestablished a Sustainability Committee and are working to steadily promote and enhance sustainability by establishing andoperating a PDCA cycle that includes all Group companies.
For details on the above Long-term Vision, the Group's Medium-Term Business Plan, and materialities, please refer to “1.
Management Policy, Business Environment and Management Issues to be Addressed (1) Management Policy.”(1) GovernanceFor promoting sustainability, including addressing climate change, we have established a Sustainability Committee chaired by
the Company's President & Chief Executive Officer, and as subordinate organizations, we have set up a Sustainability
Promotion Committee and a Human Rights Subcommittee.
The Sustainability Committee, positioned as a meeting body directly managed by the Company's President & Chief Executive
Officer alongside the Group Management Meeting, Risk Management Committee, and Internal Control Committee, holds
meetings at least twice a year to discuss and consult on the formulation of policies related to the Group's sustainability, systemestablishment, setting of metrics and targets, and monitoring and evaluating progress. The Sustainability Committee deliberates
and discusses important matters related to climate change, including the identification of risks and opportunities, greenhousegas emission reduction targets and response policies, and the status of initiatives.
Important matters deliberated and discussed by the Sustainability Committee are submitted or reported to the Board of Directors,
which makes decisions on important sustainability-related matters and monitors and supervises the status of the Company's
response to such matters.
The Sustainability Promotion Committee shares decisions made by the Sustainability Committee, discusses matters forconsideration in advance, and reports and discusses, etc. the progress of the sustainability promotion by the Group. The Human
Rights Subcommittee implements decisions made by the Sustainability Committee and reports and discusses the status of humanrights initiatives.

18

[Sustainability promotion framework]19

(2) Strategy(i) Addressing climate change
Addressing climate change is a social issue that requires global solutions, and the real estate industry is also required to takeinitiatives, including reducing greenhouse gas emissions from owned real estate and business activities. The Group recognizes
that the intensification of natural disasters including wind and water disasters caused by climate change could significantly
impact the assets it owns, and the Group recognizes that this is an issue that must also be addressed as a priority from thisperspective.
The Company has endorsed the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and has
conducted scenario analysis to identify climate change risks and opportunities, evaluate their materiality, and examine anddisclose their impact on the Group's business profit.
a. Scenario setting
We have set future worldviews (scenarios) for scenario analysis. Using scenarios released by the Intergovernmental Panel on
Climate Change (IPCC) and the International Energy Agency (IEA), we have set a 4°C scenario where the averagetemperature rises at least 4°C compared to pre-industrial levels by 2100, a 2°C scenario where the temperature rise is kept
below 2°C, and a 1.5°C scenario where the rise is further limited to 1.5°C.
b. Identification of risks and opportunities/assessment of materiality
Focusing on the Group's core businesses, Commercial Properties business and Residential business, we identified climatechange risks and opportunities for each business phase of development, operation/management, and sales/disposal, based on
the reality of developing and owning buildings in specific areas, and assessed their materiality in terms of their expected
degree of impact on the Group’s finances and likelihood. The period of impact was categorized into short-term (1 to 5 years),
medium-term (5 to 10 years), and long-term (over 10 years).
[Identified climate change risks, opportunities and their materiality]20

c. Estimation of business impact
We have quantitatively evaluated the impact that the identified climate change risks and opportunities will have on theGroup's finances in FY2030.
We have conducted qualitative analysis on risks and opportunities where quantitative data is difficult to obtain.
[Impact on the Group's business profit]d. Countermeasures
The Company has identified promoting a decarbonized society as a materiality and is working to minimize climate changerisks through its businesses and address this issue while also seizing these risks as opportunities. For promoting adecarbonized society, we have set medium- to long-term targets for reducing greenhouse gas emissions and are working
towards their achievement by developing ZEB/ZEH, developing green buildings, introducing renewable energy, and also
focusing on urban development and real estate development that consider resilience to the increasingly frequent natural
disasters including wind and water disasters caused by climate change.
As medium- to long-term targets for reducing greenhouse gas emissions, we declared CO2 emissions net-zero by FY2050 in
2021 and set a target of 40% reduction in CO2 emissions by FY2030 compared to FY2019 for Scope 1, 2, and 3. In 2023,
we will accelerate our efforts by raising the target for Scope 1 and 2 to a 46.2% reduction in CO2 emissions in FY2030
compared to FY2019, a level at which the increase in global average temperature will be limited to 1.5°C compared to preindustrial levels. In addition, as process targets to achieve medium- to long-term targets, we have set targets for the promotionof ZEB/ZEH development, introduction of renewable energy, and acquisition of green building certification.
[Our initiatives to achieve greenhouse gas emission reduction targets (CO2 emission reduction)]
ⅰ. Effective utilization of surplus energy by generating and consuming renewable energy in our self-developed properties andby utilizing self-consignment
In the T-LOGI series of logistics properties developed by the Company, solar panels are installed on the roofs, and therenewable energy generated is consumed in-house at each facility. In addition, we intentionally generate renewable energy

21exceeding the self-consumption amount at each facility and perform self-consignment to transmit the surplus renewableenergy to our suburban retail facilities and office buildings owned by the Company in multiple areas. In 2023, we started
self-consignment to downtown commercial properties in the Yaesu, Nihonbashi, and Kyobashi areas in Tokyo. We arepromoting decarbonization in urban areas where local production and consumption of renewable energy are challenging
through these initiatives.
ⅱ. Further promotion of ZEB/ZEH development
The Company has been actively pursuing the development of ZEB/ZEH. In 2023, we abandoned the target year limit
previously set for FY2030 and added condominiums for rent to the scope, developing ZEB/ZEH in all newly constructed
office buildings, logistics properties, condominiums for sale, and condominiums for rent as a principle.
(ii) Human capital
The Company recognizes that human resources are the source of value creation and sustainable growth for the Group and oneof the most important foundations of management. We have identified the improvement of employee growth and job
satisfaction as well as diversity and inclusion as materialities towards realizing our Long-term Vision, and are working onstrengthening human capital as one of the most important management issues. To achieve an improvement in corporate value
through the maximization of human capital value, based on our human resource philosophy and human resource policy, as
described below, we are actively implementing initiatives for human resource development and improvement of internal
environment, as well as expanding investments in human resources.

a. Human resource philosophy and human resource policyⅰ. Human resource philosophy: “The Company’s growth is tied to its employees’ growth; therefore, we are responsive to theircontributions.”
The Company has established a human resource philosophy as the basis for personnel measures, aiming for an organization
where both the company and employees grow together. Based on this human resource philosophy, we are committed tomaintaining and evolving an environment and corporate culture where employees are motivated to aspire for growth,maximize their abilities, and take on the challenge of new value creation by implementing and operating human resource
systems and various measures that promote the active participation and growth of employees and respond to theircontributions.

22

ⅱ. Human resource policy • Desired Human Resources: Trustworthy people, People who forge their own paths• Creating a rewarding workplace in which employees can experience growth
Under the corporate philosophy of "Trust beyond the era," we have defined the human resources we seek and the ideal
workplace in our human resource policy. Based on this policy, we are formulating and operating various personnel
measures related to recruitment and development policies and work styles and conducting employee engagement surveys
and 360-degree feedback surveys as workplace diagnostics, in working on improving the workplace environment. Throughthese initiatives, we aim to create a workplace environment as a company where we can fully utilize the capabilities of
employees, allowing every employee to feel growth through their own challenges and contributions, thereby leading to an
improvement in corporate value.
b. Initiatives for human resource development and internal environmental improvement for maximizing the value of humanresources
ⅰ. Demonstration of diversity
By promoting the participation of diverse human resources and strengthening our organizational capabilities, we hope toprovide products and services that meet the increasingly sophisticated and diverse needs of our customers, improve
productivity, and promote the creation of innovation, thereby achieving growth as a company. Based on this idea, we haveset diversity and inclusion as a materiality, and are actively recruiting new graduates as well as mid-career hires, while
also focusing on acquiring highly specialized human resources and human resources who can promote digitalization andglobalization. In addition, we have set the ratio of female managers and the employment rate of people with disabilities
as metrics and targets and are advancing recruitment and promotion with an awareness of achieving these targets.
Furthermore, we have established and are operating the following systems to create an environment in which diverse
human resources can play an active role and experience ease of work and job satisfaction without feeling any barriers.
・Flextime system, teleworking system, and reduced working hours system to achieve flexible working styles
・Leave systems for pregnancy, childbirth, childcare, and nursing care, and re-employment system for retirees
・System that allows up to three years of leave for employees accompanying a spouse on an overseas transfer
・Promoting active participation utilizing the career experience of senior generations
・Encouraging the participation of people with disabilities with flexible work arrangements according to their aptitude
and disability statusⅱ. Creation of a rewarding workplace
In order to enhance employee growth and job satisfaction, we will conduct employee engagement surveys on a regularbasis to create rewarding workplaces that will serve as the foundation for human resources growth and implement a PDCA
cycle in which offices and branches with issues will work on improvements with the assistance of experts as part of efforts
to continuously strengthen employee engagement. In addition, to enhance the ease of work for employees, we have set
annual paid leave utilization rate and male childcare leave utilization rate as metrics and targets, introduced various
systems to enable flexible working styles, and improved the ICT environment.
ⅲ. Human resources development
We have established a training system by hierarchical level aiming at role recognition and skill development according to
the growth stage and set the average training hours per person and the career training participation rate as metrics andtargets for conducting training. In addition, through self-development support systems, various qualification acquisition
support systems, and external training programs, we are focusing on fostering a culture of self-learning among employees
by preparing mechanisms that allow employees to think about and choose what knowledge and skills they need.
Furthermore, with the aim of gaining a broad perspective and experience, we conduct personnel rotations that involve
experiencing about three departments over approximately ten years after joining the Company, working on developing
human resources who can be active in various fields.
ⅳ. Health management
Based on the Group Health Management Declaration so that officers and employees can work vigorously and in good
health, both physically and mentally, the Group is implementing various measures aimed at maintaining and promoting
the health of each Group officer and employee, and the Company is working on initiatives with set metrics and targets
such as the health examination attendance rate, re-examination attendance rate, and smoking rate. In March 2023, inrecognition of these health efforts, the Company was certified for the sixth time in three consecutive years as one of the23

White 500 (the top 500 corporations in terms of health management survey results) among an Excellent HealthManagement Corporation awarded by the Ministry of Economy, Trade and Industry, which recognizes corporations thatpractice excellent health management. In addition, we are working to improve health literacy through ICT-based training
and events, such as web-based dental questionnaires and walk rally events utilizing smartphone applications.
ⅴ. Activating communication
A slight problem was found in communication between hierarchical levels in an employee engagement survey. An analysis
found that the rapid increase in the number of employees in recent years and the impact of the spread of coronavirus werethe main reasons for the decrease in communication among employees, and we are working on improvements. We areworking on developing a sense of unity by promoting internal communication through initiatives that serve asopportunities for communication, such as management and employee lunch meetings, social gathering expenses paid by
the company, and visualizing the work experiences of each employee.
(3) Risk management
The Company has established a Risk Management Committee chaired by the President & Chief Executive Officer to oversee
risk management for the Group. The Risk Management Committee formulates annual risk management plans, evaluates andanalyzes risks that are important to the Group’s management (priority risks), formulates preventive measures andcountermeasures, and periodically monitors the status of countermeasures. For risks other than priority risks, the generalmanagers of offices and branches and each committee act as risk owners to prevent and manage such risks.
Regarding sustainability risks, the Sustainability Committee, as the risk response organization (risk owner), works with relevant
offices and branches to prevent and manage such risks, and reports important matters on the implementation status of such risks
to the Risk Management Committee. Important matters discussed by the Risk Management Committee are brought up for
discussion or reported to the Board of Directors based on internal regulations, and the effectiveness of the Group's risk
management, including sustainability-related risks, is supervised by the Board of Directors.
For details of the risk management system, please refer to “3. Business Risk and Other Risk Factors (1) Risk Management
System.”(4) Metrics and targets(i) Addressing climate change
The Company has set metrics and targets (KPIs and targets) related to promoting a decarbonized society identified asmateriality and is working on various measures while quantitatively monitoring the status in each fiscal year.
Material issues

Reduction ingreenhouse gas
emissions

Promoting adecarbonizedsociety

Scope

Item

Promotion ofdevelopment of
ZEB and ZEH

All businesses

Acquisition ofGreen Building
Certification

Net zero CO2 emissions by FY2050

Scope1・2

46.2% reduction in CO2 emissions compared to FY2019 by FY2030

Scope3 (Note 1)

40% reduction in CO2 emissions compared to FY2019 by FY2030

Commercial properties
In principle, all new office buildings and logistics properties to be developed will be ZEB
business
Residential business

Shift torenewableenergyKPIs and Targets
Scope1・2・3

All businesses

In principle, all new condominiums for sale and rent to be developed will be ZEH
By FY2050, procure 100% of electricity consumed in business activities from renewable energy sources

Commercial properties By FY2030, procure 100% of electricity consumed at owned real estate from renewable energy sourcesbusiness
By FY2024, procure at least 50% of electricity consumed at owned properties from renewable energy sources
Commercial properties
Acquire Green Building Certification for, in principle, all new office buildings, logistics properties, andbusiness
condominiums for rent, etc
Residential business(Note) 1. Scope 3 categories 11 and 13 are within the scope
2. For details on the progress toward each target, please refer to the Tokyo Tatemono Group Sustainability Report.

24

(ii) Human capital
The Company has set metrics and targets (KPIs and targets) related to the improvement of employee growth and job
satisfaction as well as diversity and inclusion identified as materialities and is working on various measures whilequantitatively monitoring the status in each fiscal year.
Material issues

Item
Promotion of skills
development

Improve employee
growth and job
satisfaction

Promotion of healthmanagement

Respect for human rights

Scope

KPIs and Targets

Tokyo Tatemono

Average training time per employee

Tokyo Tatemono

Career training participationrate

Tokyo Tatemono

Health checkup rate and follow-up test rate

Tokyo Tatemono

Smoking rate

Tokyo Tatemono

Ratio of employees maintaining a healthy weight 75% by 2028

Tokyo Tatemono Group

Dissemination of the Human Rights Policy Development to and compliance by group companies

Tokyo Tatemono

Average annual paid leave utilization rate

Tokyo Tatemono

Ratio of male employees taking parental leave

Tokyo Tatemono

Ratio of women in management positions

10% or more by fiscal 2030

Tokyo Tatemono

Employment rate of people with disabilities

Each year

Every fiscal year

Each fiscal year

Each fiscal year

15 hours or more

100%

Each fiscal year

100%

12% or less

Each fiscal year

70% or more

Work-life balance
Diversity & Incrusion
Promotion of diversity in
our workforce

By fiscal 2025 30% or more

2.3% or more

(Note) For details on the progress toward each target, please refer to the Tokyo Tatemono Group Sustainability Report.

25

3. Business Risk and Other Risk Factors
In order to appropriately manage risks that may affect the Group’s business to stably increase corporate value, the Group has
established relevant regulations and a risk management system and continuously monitors and controls risks.
(1) Risk Management System
In promoting risk management, in accordance with its “Risk Management Regulations,” the Company has designated thePresident as the “Chief Risk Management Officer” and has established a “Risk Management Committee” chaired by the
President & Chief Executive Officer to oversee risk management for the Group.
The Risk Management Committee formulates annual risk management plans, evaluates and analyzes risks that are important to
the Group’s management (priority risks to be addressed), formulates preventive measures and countermeasures, and periodicallymonitors the status of countermeasures while regularly presenting agenda items for deliberation and submitting reports to theBoard of Directors.
Regarding risks other than priority risks to be addressed (department and division management risks), the general managers ofoffices and branches, who are “risk management officers” as stipulated in the Risk Management Regulations, and eachcommittee, serve as a risk response organization (risk owner) to appropriately prevent and manage said risks.
Furthermore, in order to maintain and improve the effectiveness of risk management activities, a risk governance (Three Line
Model) system has been established in which the Corporate Department and planning departments of each business division(Second Line) monitor, support, and provide instructive guidance to offices and branches (First Line) with respect to risk
management, and the Internal Audit Department (Third Line) audits and advises them in terms of their response to risk
management at offices and branches.
(Risk Management Structure Diagram)26

(2) Business Risk and Other Risk Factors
Risk is defined by the Group as “any factor of uncertainty arising in the course of business operation within the Group.” Risk
assessments are conducted on risks in the Group from the perspectives of impact (financial loss, human loss, etc.), likelihoodof occurrence, changes in business environment and corporate values. Henceforth the Risk Management Committee has
established a process for identifying “priority risks to be addressed” that are to be monitored directly by the committee.
The main risks that could affect the Group’s business performance and financial position, including the priority risks to beaddressed, are listed below. Furthermore, the risks indicated below do not cover all the risks associated with the Group, as there
are other risks that may influence the judgment of investors.
Forward-looking statements in the document are the judgment of the Group based on information available as of the end of the
fiscal year under review.

(i) Risks related to real estate development
The Group promotes its business after grasping and analyzing assumed risks in the real estate development business mainly in
the Group Management Meeting and taking countermeasures beforehand. However, when a delay in business schedule orincrease in costs, etc. occurs due to bad weather, natural disasters, delay in approval and permission, soil contamination or
buried objects being found, or other unforeseen events, the Group’s operating results, financial position, etc. may be impacted.
(ii) Risks related to price fluctuations
The Group constantly monitors and analyzes the cost trends in each business, paying close attention to the impact on
profitability. However, if there is a significant and rapid fluctuation in prices and the increase in costs cannot necessarily bereflected in rents or sales prices, the Group’s operating results, financial position, etc. may be impacted.
(iii) Risks related to trends in the real estate market
While the Group constantly monitors and analyzes domestic and international economic trends and real estate market
conditions and closely monitors the impact on its operations, the Group's operating results and financial position may beaffected by rapid or drastic fluctuations in economic conditions or market conditions resulting in a decline in office needs due
to deteriorating corporate performance in the leasing office market, a decline in customers’ willingness to purchasecondominiums in the condominium market, or a decline in investment demand in the real estate investment market.
(iv) Risks related to interest rate fluctuations
The Group has conducted stable fund procurement centering on interest-bearing debt in the form of long-term borrowings andhas fixed interest rates for almost all long-term borrowings to minimize the impact of interest rate fluctuation. However, wheninterest rates rise, the Group’s operating results as well as its financial position, etc. may be impacted and the value of assets
owned by the Group may decrease.
(v) Risks related to owned shares
The Group holds marketable shares in other companies that are deemed to help increase corporate value in the medium to longterm through maintaining and strengthening business relationships as those for other purposes than pure investment (strategic
shareholdings). Individual strategic shares are appropriately managed toward their reduction based on the “Corporate
Governance Code (Principle 1-4)” by reporting their actual transactions and others periodically to the Board of Directors andassessing whether continuing to hold them is appropriate. However, when the market price of shares falls and the value of
owned shares falls significantly, for instance, the Group’s operating results, financial position, etc. may be impacted.
(vi) Risks related to environmental issues and climate change
The Group believes that the intensification of policies and regulations related to climate change, as well as the increased
frequency and severity of extreme weather events, could potentially impact the Group’s business operations. Throughdiscussions at the Sustainability Committee chaired by the Company's President & Chief Executive Officer, the Company has
endorsed the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and has conductedscenario analysis in accordance with the recommendations of the TCFD to identify climate change risks and opportunities,
evaluate their materiality, and examine their impact on the Group's business profit. Following this, we have set targets related
to the promotion of a decarbonized society – one of our identified materialities – and we are engaged in efforts to achievethese targets. However, should there be further intensification of policies and regulations due to climate change in the future,
the Group’s operating results, financial position, etc. may be impacted.

27

(vii) Risks related to natural disasters, man-made disasters
The Group takes business continuity measures in cases of emergency, such as establishment of various regulations and manuals
as well as implementation of periodic training in preparation for earthquakes, rainstorms, flooding and other natural disasters
as well as wars, riots, terrorism and other man-made disasters. However, when natural or man-made disasters or such occur,business activities may be impacted as employees may suffer damage and the value of assets owned, managed or operated by
the Group may decrease. Accordingly, the Group’s operating results, financial position, etc. may be impacted.
(viii) Risks related to information leakage and security
The Group handles an enormous amount of personal and other confidential information in various businesses. Thus, the Groupappropriately manages information by establishing informational management rules and information system management rules
as well as by reinforcing systems to manage documents, data, etc. It further makes specific efforts, including enhancing security
for information devices on both tangible and intangible fronts and conducting training to prepare for a potential information
security risk while obtaining cyber insurance as needed. However, when information leakage outside the Group occurs due tocyberattacks, negligence of the Group’s officers and employees, etc., the loss of social credibility of the Group, occurrence ofcompensation for damage, etc. may impact the Group’s operating results, financial position, etc.
(ix) Risks related to legal compliance
The Group conducts business activities under legal regulations including the Companies Act, the Financial Instruments andExchange Act, the Labor Standards Act, the Real Estate Brokerage Act and the Building Standards Act. The Group has further
established a legal compliance structure based on the “Compliance Charter” and the “Compliance Rules” and provides
education such as periodic training to the Group and its officers and employees. However, if the Group and its officers andemployees violate laws, regulations, etc., the loss of social credibility of the Group, imposition of fines and penalties, etc. may
impact the Group’s operating results, financial position, etc.
(x) Risks related to establishment and revision of legislation, taxation systems, and government policies
The Group’s businesses are affected by regulations including ordinances, tax systems, etc. set forth by local governments aswell as by laws and regulations. Accordingly, the Group promotes business after collecting information from relevant
authorities, industry groups, professionals, etc. in a timely manner and takes appropriate measures. However, when relevantlaws and regulations, ordinances, tax systems, etc. are established, revised, etc. in the future, this may impact the Group’s
operating results, financial position, etc. due to the newly arising obligations, increase in cost burden, restriction on rights, etc.,
possibly leading to a decrease in the value of assets owned by the Group. Furthermore, when a difference arises in views oftax reporting with tax authorities, the Group’s operating results, financial position, etc. may be impacted.
(xi) Country risk related to the Group’s overseas operations
The Group operates in China, Southeast Asia, and the United States based on “Growth in Overseas Businesses,” one of the
key strategies spelled out in the Group’s Medium-Term Business Plan. In conducting business overseas, it strives to collectnecessary and appropriate information through partnerships with local entities that are well-versed in the political or economic
climate and laws and regulations in the respective countries or regions where it operates. However, if a project is halted, aschedule is delayed or costs increase due to the deterioration of political or economic conditions, any change of laws andregulations, and worsening security, to name but a few, in the countries where we operate, it may impact the Group’s operating
results, financial position, etc.
(xii) Risks related to infectious diseases
If the economy stagnates or deteriorates in Japan due to factors such as the re-spread of coronavirus infections or the outbreakof influenza, the Group’s operating results, financial position, etc. may be impacted. The same concern is shared with foreigncountries in which the Group develops oversea businesses (China, Southeast Asia, and the United States); if the economy
slows down or weakens, it could impact the Group’s operating results, financial position, etc.

28

4. Management Analysis of Financial Position, Operating Results and Cash Flows(1) Summary of Operating Results
The overview of financial position, operating results, and cash flows (hereinafter referred to as “operating results, etc.”) of theGroup for the current consolidated fiscal year is as follows.
(i) Operating results
The Japanese economy in the current consolidated fiscal year has been on a moderate recovery trend as economic and social
activities normalized with the subsidence of the coronavirus pandemic, improvement in employment and income environment,
and effects of various policies. However, the situation remained uncertain with concerns about the prolonged situation in
Ukraine, instability in the Middle East, downside risks in the global economy, and the impact of currency fluctuations.
In the real estate industry, the vacancy rate in the leasing office market remained at a relatively high level, but the rate started
to decrease in some areas in the second half of the fiscal year with the spread of returning to the office. The residential property
market continued to perform well despite a decrease in the number of new condominiums supplied and rising sales prices,against a backdrop of continued low interest rates and an increase in dual-income households. Although the real estate
investment market remained strong overall, investment demand from overseas investors declined due to worsening real estatemarket conditions overseas and expectations of higher interest rates in Japan, while Japanese investors continued to show
strong investment appetite.
Under this business environment, the Group has focused on promoting five key strategies based on the Group Medium-TermBusiness Plan for the period from FY2020 to FY2024, aiming to solve social issues and achieve higher levels of growth as acompany as stated in our Long-term Vision for around 2030, and on an “Evolved Approach to ESG Management.” The Groupmade overall steady progress in one of its key strategies, “Pursue large-scale redevelopment,” including steady progress inacquiring important permits and approvals for redevelopment projects in the Yaesu, Kyobashi, and Shibuya areas. For further
strengthening of the condominium business, we have endeavored to provide high-quality housing that accurately responds tochanges in social and customer needs using our unique know-how and the Brillia brand, such as Brillia City Shakujii Koen
ATLAS (Nerima-ku, Tokyo), a comprehensive rebuilding project of one of the largest apartment complexes in the 23 wardsof Tokyo, and focused on creating diverse business opportunities including new redevelopment and reconstruction projects.
Regarding our “Evolved Approach to ESG Management” to accelerate efforts towards achieving a decarbonized society, weraised the Group's medium- to long-term targets for reducing greenhouse gas emissions to a level that would limit the global
average temperature rise to 1.5°C compared to pre-industrial levels and formulated and disclosed new guidelines to promote
understanding and implementation of sustainable procurement standards by suppliers aimed at achieving procurement thatconsiders human rights respect and environmental conservation, etc. throughout the supply chain. The Group continuously
pursues initiatives aimed at coexisting with nature, and the Otemachi Tower (Chiyoda-ku, Tokyo), which houses the Otemachi
Forest, was recognized as a “Site of Coexistence with Nature” (note) by the Ministry of the Environment for its efforts inconserving biodiversity as a project that has been working on the regeneration of the natural environment in the city center forover 10 years since its completion. In the fiscal year under review, Metropolitan Meiji Park (located in Shinjuku-ku, Tokyo)
was partially opened as the first Park-PFI project in Tokyo, and as a representative of the private sector, we are committed tocreating a legacy for the city of Tokyo through this park that combines an abundant natural environment with lively functions,
including a wooded area based on the concept of creating a forest that will grow over time with the citizens of the city. The
external evaluation of the Group's ESG management has improved year by year, and in the fiscal year under review, the Groupwas selected as a constituent of the FTSE4Good Index Series and the FTSE Blossom Japan Index, which are leading ESG
investment indices, and became a constituent stock of all ESG indices used by the Government Pension Investment Fund(GPIF) targeting Japanese stocks.
In addition, as part of our efforts to optimize the business portfolio, we divested all shares of two subsidiaries, one handlingthe childcare facility-related business and the other handling the temporary staffing services business. To strengthen the fundbusiness, we converted Tokyo Realty Investment Management, Inc. into a wholly owned subsidiary, thereby advancing various
initiatives toward achieving the Long-term Vision and the Group's Medium-Term Business Plan.
(Note) Implemented by the Ministry of the Environment from FY2023 as a key measure towards achieving the goal ofeffectively conserving more than 30% of land and sea areas as healthy ecosystems by 2030 (30by30 goal).
In the current consolidated fiscal year, the leasing of buildings and Parking business performed solidly, and sales from property
sales to investors in the Commercial Properties business, Residential business, and Asset Service business increased comparedto the previous fiscal year. Consequently, operating revenue totaled ¥375,946 million (up 7.4% from ¥349,940 million for theprevious fiscal year), and operating profit was ¥70,508 million (up 9.4% from ¥64,478 million for the previous fiscal year).

29

Furthermore, due to an increase in the share of profit of entities accounted for using equity method in overseas businesses,
business profit amounted to ¥74,428 million (up 12.3% from ¥66,304 million for the previous fiscal year), ordinary profit was¥69,471 million (up 9.3% from ¥63,531 million for the previous fiscal year) and profit attributable to owners of parent was¥45,084 million (up 4.7% from ¥43,062 million for the previous fiscal year).
The Group uses “business profit”, the sum of operating profit and share of profit (loss) of entities accounted for using equity
method, as a target profit indicator.
The business results for each segment are as follows.

30

a. Commercial Properties businessIn large-scale redevelopment projects, the Type-1 Urban Redevelopment Project for Yaesu 1-Chome East Area in Front ofTokyo Station (District A, District B) (Chuo-ku, Tokyo) received approval for the District A right conversion plan, and theestablishment of the urban redevelopment union for the Type-1 Urban Redevelopment Project for Shibuya 2-Chome WestArea (Shibuya-ku, Tokyo) was approved, demonstrating steady progress in essential authorization procedures. In for-saleproperties for investors, we completed four logistics properties, including T-LOGI Ichinomiya (Ichinomiya-shi, Aichi
Prefecture), and aggressively pushed forward the development of a diverse range of assets (“T-PLUS” series of mediumsized office buildings, hotels, retail facilities, etc.).
In the current consolidated fiscal year, we recorded sales from T-LOGI Narashino II (Narashino-shi, Chiba Prefecture), TLOGI Honjo Kodama (Kodama-gun, Saitama Prefecture), etc. as property sales to investors, while costs for leasing ofbuildings increased compared to the previous fiscal year. Consequently, operating revenue was ¥155,256 million (up 7.0%
from ¥145,155 million for the previous fiscal year), operating profit was ¥38,483 million (down 5.9% from ¥40,910 million
for the previous fiscal year) and business profit was ¥40,153 million (down 2.5% from ¥41,204 million for the previous fiscal
year).

FY2022Category

Operating revenue(Millions of yen)

Quantity
Rentable
Leasing of buildings

FY2023

947,514㎡(Of which forsublease

Real estate sales

76,73581,095㎡）
2 deals

Operatingrevenue(Millions of yen)

Quantity
Rentable

1,040,870㎡(Of which forsublease

67,227㎡）

29,812

8 deals

78,27538,643

Building
management service,etc.

－

38,607－38,337

Total operating revenue－

145,155－

155,256

Operating profit－

40,910－38,483Business profit－

41,204－40,15331

b. Residential businessWe have developed new projects through a variety of business methods. For example, in condominiums, we recorded
revenues from SHIROKANE The SKY (Minato-ku, Tokyo), an urban redevelopment project to maintain and renew a varietyof urban functions, including residential, commercial, industrial, and hospital buildings; and Brillia City Shakujii Koen
ATLAS (Nerima-ku, Tokyo), a project to rebuild one of the largest apartment complexes in the 23 wards of Tokyo; and the“Minoh Sun Plaza No. 1 Site Sale Project” (Minoh-shi, Osaka), the first project in Kansai where the condominium site salesystem was utilized. In for-sale properties for investors, we actively promoted the development of Brillia ist condominiums
for rent and completed two properties including Brillia ist Kuramae Residence (Taito-ku, Tokyo).
In the current consolidated fiscal year, in addition to the condominiums mentioned above, we recorded Brillia Nerima
Kasuga-cho (Nerima-ku, Tokyo) and other properties as income, and Blan Canvas Rokkomichi (Nada-ku, Kobe-shi) as
income from property sales to investors. Consequently, operating revenue was ¥134,140 million (up 2.1% from ¥131,390
million for the previous fiscal year), operating profit was ¥27,155 million (up 16.5% from ¥23,304 million for the previous
fiscal year) and business profit was ¥27,149 million (up 16.5% from ¥23,304 million for the previous fiscal year).

FY2022Category

Operating revenue(Millions of yen)

Quantity
Residential sales

1,435 units

Real estate sales
Residence leasing

FY202385,9585,309

Number of units 98,006 units

20,664－

5,948

13,743

Number of units 99,083 units

14,321

－

8,879

－

9,176

Total operating
revenue－

131,390－

134,140

Operating profit－

23,304－

27,155Business profit－

23,304－

27,149Other

125,085㎡

32

Rentable

84,029117,973㎡

Condominium
management service

Rentable

1,058 units

17,500－Operating revenue(Millions of yen)

Quantity

c. Asset Service business
The brokerage business of Tokyo Tatemono Real Estate Sales Co., Ltd. aimed to further increase profitability through means
such as strengthening relationships with corporate customers and expanding transactions with investors. The Asset solution
business of the company, in collaboration with the brokerage business and by strengthening sales to existing clients,
successfully progressed in acquiring and selling real estate for sale, and the structuring and sale of small-lot real estate
products as a new initiative. In the Parking business operated by Nihon Parking Corporation, we worked to acquire newfacilities to further increase revenue, and also to enhance the functionality of the parking facilities system to improve customer
service.
In the current consolidated fiscal year, the Parking business saw a recovery in the occupancy rate of existing facilities and anincrease in the number of parking space due to the opening of new facilities, while the Asset solution business saw asignificant increase in sales from property sales to investors compared to the previous fiscal year. Consequently, operating
revenue was ¥63,800 million (up 27.0% from ¥50,240 million for the previous fiscal year), and operating profit and businessprofit were each ¥12,907 million (up 74.4% from ¥7,399 million for the previous fiscal year).

FY2022Category

FY2023Operating revenue(Millions of yen)

Quantity

Quantity

Operating revenue(Millions of yen)

Brokerage

1,086 deals

4,626

1,097 deals

5,499

Asset solution (Note)－

19,084－29,999Management service, etc.

－

4,554

－

4,567

Parking lot operations

Number of
80,057parking spaces spaces

21,975

Number of 82,542
parking spaces spaces

23,734

Total operating revenue－

50,240－63,800Operating profit

－

7,399

－

12,907

Business profit

－

7,399

－

12,907(Note) This business mainly purchases real estate and resells them after improving their added value.

33

d. Other businessIn the Leisure business, the Regina Resort, a dog-friendly resort hotel and golf course operated by Tokyo Tatemono ResortCo., Ltd. continued to maintain high occupancy rates throughout the year, and the number of visitors and sales recovered at
hot-spring facilities, which had been suffering from the prolonged impact of the coronavirus pandemic. In addition, as partof efforts to optimize our business portfolio, we transferred all shares of two subsidiaries, one in the childcare facility-related
business and the other in the temporary staffing services business. In Overseas businesses, we participated in the Sukhumvit
25 Project (Bangkok Metropolitan Administration), a medium-sized office building development project in Thailand, and in
the Herndon Project (Virginia), a residential leasing development project near Washington, D.C. in the United States.
In the current consolidated fiscal year, revenue in the Leisure business decreased from the previous year due to the impact of
the transfer of all shares in two subsidiaries, while share of profit of entities accounted for using equity method in Overseas
businesses increased from the previous fiscal year. Consequently, operating revenue was ¥22,748 million (down 1.8% from
¥23,154 million for the previous fiscal year), operating profit was ¥2,204 million (down 12.5% from ¥2,518 million for theprevious fiscal year) and business profit was ¥4,460 million (up 10.1% from ¥4,050 million for the previous fiscal year).

Category

FY2022

FY2023Operating revenue(Millions of yen)

Operating revenue(Millions of yen)

Leisure business

18,541

18,582

Other

4,612

4,166

Total operating revenue

23,15422,748Operating profit

2,518

2,204

Business profit

4,050

4,460

34

(ii) Outline of Financial Position for the Consolidated Fiscal Year Under Review(Assets)
Total assets at the end of FY2023 were ¥1,905,309 million, up ¥185,175 million from the end of the previous consolidated
fiscal year. This was primarily attributable to the increase in real estate for sale (including real estate for sale in process andreal estate for development), cash and deposits, property, plant and equipment, and investment securities.
(Liabilities)
Total liabilities at the end of FY2023 were ¥1,397,274 million, up ¥133,977 million from the end of the previous consolidated
fiscal year. This was due to factors including an increase in interest-bearing debt. The balance of interest-bearing debt
(excluding lease obligations) was ¥1,089,006 million, up ¥99,207 million from the end of the previous consolidated fiscal
year.
(Net assets)
Total net assets at the end of FY2023 were ¥508,035 million, up ¥51,197 million from the end of the previous consolidated
fiscal year. This was primarily attributable to an increase in retained earnings and valuation difference on available-for-salesecurities.
(iii) Outline of Cash Flows for the Fiscal Year Under Review
Consolidated cash and cash equivalents (hereinafter “cash”) at the end of FY2023 stood at ¥127,303 million, up ¥44,864
million from the end of the previous consolidated fiscal year. This was primarily due to ¥20,588 million provided by operating
activities, ¥54,069 million used in investing activities, and ¥77,908 million provided by financing activities.
Current consolidated fiscal year cash flows for each category are as follows.
(Cash flows from operating activities)
Cash provided by operating activities at the end of FY2023 stood at ¥20,588 million (up ¥23,921 million from the previous
fiscal year). This was primarily attributable to cash inflows due to profit before income taxes and depreciation on the one handand cash outflows due to an increase in inventories on the other.
(Cash flows from investing activities)
Net cash used in investing activities at the end of FY2023 stood at ¥54,069 million (down ¥32,864 million from the previous
fiscal year). This was primarily attributable to cash outflows due to the acquisition of non-current assets and loans.
(Cash flows from financing activities)
Cash provided by financing activities at the end of FY2023 stood at ¥77,908 million (up ¥59,487 million from the previous
fiscal year), primarily attributable to cash inflows due to long-term borrowings.
(iv) Production, Orders and Sales Results
Production, orders received, and sales results are shown in relation to the results of each segment in “(i) Operating Results.”35

(2) Overview of Management’s Discussion and Analysis of Operating Results and Other Matters
The following is a summary of the recognition, analysis, and discussion of the Group’s operating results from the management’s
perspective.
Any forward-looking statement mentioned below is based on the Group judgment as of the end of the current consolidated
fiscal year.
(i) Objective indicators for determining the achievement of the management policy, strategy, goals, etc.
Under the Group’s Medium-Term Business Plan (FY2020-FY2024), which was instituted in FY2020, the Group has set a
consolidated business profit target of ¥75.0 billion for FY2024, the final year of the plan. We have set a D/E ratio of
approximately 2.4 times and an interest-bearing debt / EBITDA multiple of approximately 12 times as financial guidelines forachieving said targets.
Details of the achievement status in the current consolidated fiscal year are as follows.
FY2023 Actual Results
Consolidated business profit¥74.4 billion

D/E Ratio

2.2 times

Interest-bearing debt / EBITDA ratio

10.9 times(ii) Analysis of operating results
In the Group’s consolidated performance for the current consolidated fiscal year, the leasing of buildings and Parking businessperformed solidly, and sales from selling properties to investors in the Commercial Properties business, Residential business,and Asset service business increased compared to the previous fiscal year. Consequently, operating revenue totaled ¥375,946
million (up 7.4% from ¥349,940 million for the previous fiscal year), and operating profit was ¥70,508 million (up 9.4% from¥64,478 million for the previous fiscal year). Furthermore, due to an increase in the share of profit of entities accounted forusing equity method in overseas businesses, business profit amounted to ¥74,428 million (up 12.3% from ¥66,304 million forthe previous fiscal year), ordinary profit was ¥69,471 million (up 9.3% from ¥63,531 million for the previous fiscal year) andprofit attributable to owners of parent was ¥45,084 million (up 4.7% from ¥43,062 million for the previous fiscal year).
For an overview of the performance of each segment, please refer to “(i) Operating Results, under (1) Summary of BusinessResults.”(iii) Capital resources and liquidity of cash
Capital requirements of the Group are mainly for the acquisition and development of real estate. Henceforth, the Group raises
funds for these capital requirements by borrowing from financial institutions, issuing bonds, and cash flows from operating
activities. In addition, the Company and its major consolidated subsidiaries have introduced a cash management system (CMS)
to consolidate surplus funds of each company to the Company for centralized management, thereby improving the efficiency
of funds.
Further, the analysis of capital resources and liquidity of funds is as described in “(iii) Outline of Cash Flows for the Fiscal
Year Under Review, under (1) Summary of Business Results,” and the analysis of financial position is as described in “(ii)Outline of Financial Position for the Fiscal Year Under Review under (1) Summary of Business Results.”(iv) Significant accounting estimates and assumptions used in making such estimates
Significant accounting estimates used in the preparation of the consolidated financial statements and the assumptions used in
making such estimates are described in “(1) Notes to Consolidated Financial Statements (Material accounting estimates)” of“1. Consolidated Financial Statements etc., under V. Financial Information.”

5. Material Agreements, etc.
Not applicable.

6. Research and Development
Not applicable.

36III. Property and Equipment
1. Summary of Capital Investment
For the current consolidated fiscal year, the Group made capital investments totaling ¥45,510 million in the Commercial
Properties business, primarily for the additional acquisition of the Tokyo Tatemono Yaesu Building.
The breakdown of capital investments by segment is as follows:(Investment figures include property, plant and equipment, and intangible assets. Amounts do not include consumption tax,
etc.)

Segment

FY2022

FY2023

Increase (decrease)(Millions of yen)

(Millions of yen)

(Millions of yen)

Commercial Properties
business

17,326

40,71023,383

Residential business

1,357

884

(472)

Asset Service business

1,519

1,307

(212)

635

2,520

1,885

20,83845,423

24,58474

86

12

20,91245,51024,597

Other business
Subtotal
Elimination or corporate
expensesTotal

37

2. Major Property and Equipment
Major facilities of the Company and its consolidated subsidiaries are as follows.
(1) Commercial Properties Business
As of December 31, 2023
Book value
Company nameFacility Name
(Location)

Main Use

Tokyo Tatemono
Co., Ltd.

Muromachi Building(Chuo-ku, Tokyo)

RentalofficeTokyo Tatemono
Co., Ltd.

Muromachi Building
No.3(Chuo-ku, Tokyo)

RentalofficeTokyo Tatemono
Co., Ltd.

Nihonbashi First
Building(Chuo-ku, Tokyo)

Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.
The silent
partnership
operated by Tokyo
Prime Stage Y.K.
Tokyo Tatemono
Co., Ltd.

Kasumigaseki
Building No. 7 PFI
Co., Ltd.

Structural Scale, etc.

Steel-framed reinforced
concrete structure
9 floors above ground, 3
floors below ground
Steel-framed reinforced
concrete structure
10 floors above ground, 2
floors below ground
Steel-framed reinforced
concrete structure
9 floors above ground, 1
floor below ground

RentalofficeStore for
rent
RentalSteel frame
Yaesu Building
office11 floors above ground, 2(Chuo-ku, Tokyo）
Store forfloors below ground
rent
RentalNihonbashi TI
officeSteel frame
Building
Store for 9 floors above ground(Chuo-ku, Tokyo)
rent
RentalSteel-framed and steeloffice
Tokyo Square Garden
reinforced concrete structure
Commer(Chuo-ku, Tokyo)
24 floors above ground, 4
cial Retail,floors below groundetc.
RentalofficeSteel frame
Nihonbashi Building
Commer- 13 floors above ground, 2(Chuo-ku, Tokyo)
cial Retail, floors below groundetc.
RentalSteel-framed and steeloffice
Kyobashi Edograndreinforced concrete structure
Commer(Chuo-ku, Tokyo）
32 floors above ground, 3
cial Retail,floors below groundetc.
RentalSteel-framed and steelEmpire Building
officereinforced concrete structure(Chuo-ku, Tokyo)
Store for 10 floors above ground, 1
rent
floor below ground
Steel-framed reinforced
Yaesu Sakura-dori
Rentalconcrete structure
Building
office11 floors above ground, 2(Chuo-ku, Tokyo)
floors below ground
Steel-framed reinforced
Jimbocho Building
Rentalconcrete structure(Chiyoda-ku, Tokyo) office
8 floors above ground,1
floor below ground
RentalJA Building・
officeSteel frame
Keidanren Building
Commer- 37 floors above ground, 4(Chiyoda-ku, Tokyo) cial Retail, floors below groundetc.
RentalSteel-framed and steeloffice
The Otemachi Tower
reinforced concrete structure
Commer(Chiyoda-ku, Tokyo)
38 floors above ground, 6
cial Retail,floors below groundetc.
RentalSteel-framed and steelOtemachi Financial
officereinforced concrete structure
City Grand Cube
Commer31 floors above ground, 4(Chiyoda-ku, Tokyo) cial Retail,floors below groundetc.
Steel-framed, steelRental
reinforced concrete
Kasumigaseki
officestructure, reinforced
Common Gate
Commerconcrete(Chiyoda-ku, Tokyo) cial Retail,38 floors above ground, 3
etc.
floors below ground38

Buildings
Land, etc.
total floor(Note) 1, (Note) 2(Note) 2

(m2)

(m2)

(Note) 3

Buildings
Land, etc.
and
Other
Total
(Millions structures (Millions (Millionsof yen) (Millions of yen)of yen)of yen)

755

9,113

7,847

546

0

8,394

1,444

12,382

9,473

1,061

29

10,563

285

2,004

1,722

411

1

2,134

2,649

23,32916,2504,747

18

21,016

559

4,885

2,807

793

14

3,615

3,746

54,16175,8748,032

1683,923

2,021
[298]

21,13523,8814,433

24

28,340

610

8,497

5,635

4,196

－

9,832

632

5,061

1,957

1,332

14

3,305

623

5,538

13,4411,139

14

14,596

1,214

9,046

7,990

920

24

8,935

1,107

18,04814,2452,465

15

16,726

7,875[7,875]

147,91089,841

44,345

142

134,329577

10,738

7,075

1,974

0

9,049

1,978
[1,978]21,408

－

4,896

0

4,896

Book value
Company nameFacility Name
(Location)

Main Use

RentalShinjuku Center
officeBuilding
Store for(Shinjuku-ku, Tokyo)
rentPanasonic Meguro
Building (former DNPTokyo Tatemono
RentalGotanda Building)Co., Ltd.
office(Shinagawa-ku,
Tokyo)
Osaki New City
Tokyo Tatemono
RentalNo. 3・Nissei
Co., Ltd.
officeBuilding
Tokyo TatemonoStore for(Shinagawa-ku,
Resort Co., Ltd.
rent
Tokyo)The silent
RentalOsaki Center Building
partnership operated
office(Shinagawa-ku,
by Osaki First StageStore forTokyo)
Y.K.
rent
Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.

Aoyama Building(Minato-ku, Tokyo)

RentalofficeTokyo Tatemono
Co., Ltd.

Shibuya Building(Shibuya-ku, Tokyo)

RentalofficeTokyo Tatemono
Co., Ltd.

Ebisu Building(Shibuya-ku, Tokyo)

RentalofficeTokyo Tatemono
Co., Ltd.

RentalofficeHareza Tower
Store for(Toshima-ku, Tokyo)
rentCinemaTokyo Tatemono
Co., Ltd.

RentalofficeNakano Central Park
Commer(Nakano-ku, Tokyo)-cialRetail, etc.

Tokyo Tatemono
Co., Ltd.

Machida Building
Rental(Machida-shi, Tokyo) office

Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.

Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.

Yokohama First
RentalBuilding
office(Nishi-ku, Yokohama)
SMARK
Retail(Isesaki-shi, Gunma
facilities
pref.)

Structural Scale, etc.

(Note) 2

(m2)

(m2)

(Note) 3

Buildings
Land, etc.
and
Other
Total
(Millions structures (Millions (Millionsof yen) (Millions of yen)of yen)of yen)Steel frame
54 floors above ground, 4
floors below ground

7,434

89,95690,418

11,126

40

101,585

Steel-framed and steelreinforced concrete structure
25 floors above ground, 2
floors below ground

8,225

48,063

20,9796,747

127,728

Steel frame
21 floors above ground, 2
floors below ground

2,224

11,664

5,493

2,232

0

7,726

5,420
[5,420]37,797

711

6,835

6

7,553

737

5,155

4,938

442

0

5,381

593

3,907

2,680

387

10

3,077

1,051
[1,051]

4,853

3,180

553

12

3,747

2,027
[2,027]38,44655

15,422258

15,736

13,58686,36855,57013,045

109

68,725

1,507[1,507]

8,077

2,651

1,132

7

3,791

966

12,239

5,575

1,382

13

6,971

135,054[129,382]

110,960

1,032

5,549

110

6,693

920

10,529

3,284

271

20

3,576

1,359
[237]

14,492

8,195

2,340

25

10,561

2,201

24,563

12,042

4,434

145

16,621

2,768

26,794

10,2472,770

38

13,056

871

6,079

1,003

2,488

117

3,610

2,134

14,603

4,574

1,057

9

5,641

Steel-framed reinforced
concrete structure
17 floors above ground, 2
floors below ground
Steel-framed reinforced
concrete structure
8 floors above ground, 2
floors below ground
Steel-framed reinforced
concrete structure
8 floors above ground, 1
floor below ground
Steel-framed reinforced
concrete structure
9 floors above ground, 2
floors below ground
Steel-framed, steelreinforced concrete
structure, reinforced
concrete
33 floors above ground, 2
floors below ground
Steel-framed and steelreinforced concrete structure
22 floors above ground, 1
floor below ground, etc.
Steel-framed reinforced
concrete structure
10 floors above ground, 2
floors below ground
Steel frame
15 floors above ground, 3
floors below ground
Steel frame
5 floors above ground

Steel-framed reinforced
concrete structure
9 floors above ground, 3
floors below ground
Steel-framed and steelUmeda Building
Rentalreinforced concrete structure(Kita-ku, Osaka)
office14 floors above ground, 4
floors below ground
Steel-framed, steelRental
reinforced concrete
officeGrand Front Osaka
structure, reinforced
Commer(Kita-ku, Osaka)
concretecial Retail,38 floors above ground, 3
etc.
floors below ground, etc.
Steel-framed reinforced
Shijo Karasuma FT
Rentalconcrete structure
Squareoffice11 floors above ground, 3(Shimogyo-ku, Kyoto)
floors below groundShijo Karasuma
RentalSteel frame
Building EAST
office7 floors above ground(Shimogyo-ku, Kyoto)
RentalSteel-framed reinforced
Shijo SET Building
officeconcrete structure(Shimogyo-ku, Kyoto) Store for 8 floors above ground, 1
rent
floor below ground
Honmachi Building(Chuo-ku, Osaka)

Buildings
Land, etc.
total floor(Note) 1, (Note) 2

Rentaloffice39

Company nameFacility Name
(Location)

Buildings
total floor(Note) 1, (Note) 2
Land, etc.

Main Use

Tokyo Tatemono
Co., Ltd.

Hakata Building
Rental(Hakata-ku, Fukuoka) office

Tokyo Tatemono
Co., Ltd.

Sendai Building(Aoba-ku, Sendai)

Tokyo Tatemono
Co., Ltd.
Meieki 2-chome
Kaihatsu Tokutei
Mokuteki Kaisha

RentalNagoya Prime Central
officeTower
Store for(Nishi-ku, Nagoya)
rent

RentalofficeStructural Scale, etc.

Steel-framed reinforced
concrete structure
12 floors above ground, 1
floor below ground
Steel frame
20 floors above ground, 3
floors below ground
Steel frame
23 floors above ground, 1
floor below ground(Note) 2

(m2)

(m2)

Book value (Note) 3
Buildings
Land, etc. and structu Other
Total
res
(Millions(Millions (Millionsof yen) (Millions of yen)of yen)of yen)1,214

10,144

3,519

496

131

4,148

2,359

28,496

11,3883,895

38

15,322

3,748

25,008

7,542

3,445

1

10,989(Notes) 1. Land includes the leasehold interests in land. The figures in [ ] represent the leasehold interests in land.
2. Land and buildings’ total floor represent the Company’s and its consolidated subsidiaries’ equity.
3. Of the Book value, Land, etc. consists of the total figure of land and leasehold interests in land, and Other consists of thetotal amount of Property, plant and equipment excluding land, buildings and structures, and intangible assets other thanleasehold interests in land.
The Book value is the figure in the consolidated financial statements.
4. In addition to the above, the Company leases the following major buildings for sublease.
As of December 31, 2023
Company nameTokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.
Tokyo Tatemono
Co., Ltd.

Name

Leased area (m2)Location

Shinjuku Square Tower

Shinjuku-ku, Tokyo

27,792

Kousei Sanbancho Daiichi Building

Chiyoda-ku, Tokyo

7,193

East Square Omori

Shinagawa-ku, Tokyo

6,521(2) Residential Business
As of December 31, 2023
Book value
Facility Name
(Location)

Main Use

Kachidoki
GROWTHTOWN Co., Ltd.

Brillia ist Tower
Kachidoki（Chuo-ku, Tokyo）

Condominiums for
rent

Tokyo Tatemono
Co., Ltd.

Class Aoyama(Minato-ku, Tokyo)

Condominiums for
rent

Tokyo Tatemono
Co., Ltd.

Brillia ist Shinonome
Canalcoat(Koto-ku, Tokyo)

Condominiums for
rent

Company name

Structural Scale, etc.

Reinforced concrete
structure
45 floors above ground, 2
floors below ground
Reinforced concrete
structure and steel-framed
25 floors above ground, 1
floor below ground
Reinforced concrete
structure
14 floors above ground, 1
floor below ground, etc.

Buildings
Land, etc.
total floor(Note) 1, (Note) 2(m2)(Note) 2(m2)(Note) 3

Buildings
andLand, etc.
Other
Total
(Millions structures (Millions (Millionsof yen) (Millions of yen)of yen)of yen)5,034[5,034]54,431

36

10,032

151

10,2202,860[2,860]

9,152

0

4,803

84

4,888

7,739
[7,739]40,988

0

3,804

59

3,863

(Notes) 1. Land includes the leasehold interests in land. The figures in [ ] represent the leasehold interests in land.
2. Land and buildings’ total floor represent the Company’s and its consolidated subsidiaries’ equity.
3. Of the Book value, Land, etc. consists of the total figure of land and leasehold interests in land, and Other consists of thetotal amount of Property, plant and equipment excluding land, buildings and structures, and intangible assets other thanleasehold interests in land.
The Book value is the figure in the consolidated financial statements.

40

(3) Asset Service Business
As of December 31, 2023

Company nameNihon Parking
Corporation

Facility Name

Parking facilities（Number of parking
spaces: 82,542）

Main Use

Hourly and/or
monthly rentals
parking lot

Structural Scale,etc.

－Land, etc.
(m2)－Book value(Note)
Buildings
Buildings
total floor Land, etc.
and
Other
Total
(m2)
(Millions structures (Millions (Millionsof yen) (Millions of yen)of yen)of yen)
－

6,718

4,909

2,580

14,208(Note) Of the Book value, Land, etc. consists of the total figure of land and leasehold interests in land, and Other consists of thetotal amount of Property, plant and equipment excluding land, buildings and structures, and intangible assets other thanleasehold interests in land.
The Book value is the figure in the consolidated financial statements.
(4) Other Business
As of December 31, 2023

Company nameTokyo Tatemono ResortCo., Ltd.
Tokyo Tatemono ResortCo., Ltd.
Tokyo Tatemono Co.,Ltd.
Kawaguchiko Country
Club Inc.

Facility Name
(Location)

Main Use

Ofuro no Osama Wako
Hot bath(Wako-shi, Saitama Pref.)facility
9 other stores
Regina Resort KyuKaruizawa(Kitasaku-gun, Nagano
HotelPref.)
7 other facilities
J-Golf Tsurugashima(Hidaka-shi, Saitama
Golf course
Pref.)
facilities
11 other locations

Structural Scale,etc.

Land, etc.
(Note) 1(m2)

Book value(Note) 2
Buildings
Buildings
total floor
Land, etc.
and
Other
Total
area
(Millions structures (Millions (Millions(m2)
of yen) (Millions of yen)of yen)of yen)－44,120[44,120]

34,415

6

2,506

220

2,734

－

19,434

15,714

965

1,898

1,174

4,038

－

14,683,173[3,144,735]

77,601

10,043

1,701

3,539

15,284(Notes) 1. Land includes the leasehold interests in land. The figures in [ ] represent the leasehold interests in land.
2. Of the Book value, Land, etc. consists of the total figure of land and leasehold interests in land, and Other consists of thetotal amount of Property, plant and equipment excluding land, buildings and structures, and intangible assets other thanleasehold interests in land.
The Book value is the figure in the consolidated financial statements.

41

3. Plans for Capital Investment, Disposals of Property and Equipment, etc.
(1) Capital Investment

Segment

Commercial
Properties
business

Company nameTokyo
TatemonoCo., Ltd.

Facility Name
(Location)

Type-1 Urban
Redevelopment
Project for Yaesu 1Chome East Area in
Front of Tokyo Station(District A, District B)(Chuo-ku, Tokyo)

Commercial
Properties
businessTokyo
TatemonoCo., Ltd.

Yaesu 1-chome North
District Category 1
Urban
Redevelopment
Project(Chuo-ku, Tokyo)

Commercial
Properties
businessTokyo
TatemonoCo., Ltd.

Kyoto Kawaramachi
Sanjo Building(Nakagyo-ku, Kyoto)

Main Use

Scale, etc.

(District A)
10 floors above ground, 2
floors below groundTotal floor: 42pprox.. 12,000m2 (overall)(District B)
51 floors above ground, ４

OfficeStore
Bus terminal
Conference center
Medical facilities
Parking lot, etc.

BudgetaryAmountCommencement andamountpaidscheduled(Millions of (Millions ofcompletion date
yen)
yen)

140,000

23,656(District A)
Start ofconstruction
2024
Completion(Acquisition)
2026(District B)
Start ofconstruction
2021
Completion(Acquisition)
2025

8,084

Start of main
construction
2024
Minami-gaiku
completion(acquisition)
2028
Kita-gaiku
completion(acquisition)
2031

25,708Start ofconstruction
April 2022
CompletedMay 2024

floors below groundTotal floor: 42pprox.. 225,000
m2 (overall)

OfficeStore
Accommodations
Parking lot, etc.

(Minami-gaiku)
44 floors above ground, 3
floors below groundTotal floor: 42pprox.. 185,500
m2 (overall)(Kita-gaiku)
2 floors above groundTotal floor: 42pprox.. 1,000m2 (overall)Hotel

9 floors above ground, 2
floors below groundTotal floor: 42pprox.. 25,800
m2

78,00042,000(Notes) 1. The Company participates in the Type-1 Urban Redevelopment Project for Yaesu 1-Chome East Area in Front of Tokyo
Station (District A, District B) as a property rights holder and specified business agent. The budgeted amount is thereserved floor space the Company is scheduled to acquire.
2. The Company participates in the Yaesu 1-chome North District Category 1 Urban Redevelopment Project as a property
rights holder and participating committee member. The budgeted amount is the floor space for the participating
committee member the Company is scheduled to acquire.
3. The Company’s funds, borrowings, and bonds will cover future capital requirements.
(2) Renovation

Segment

Commercial
Properties
business

Company nameTokyo
TatemonoCo., Ltd.

Facility Name

Existing buildings

Construction period

January 2024 to December 2024

(Note) The Company’s funds and borrowings will cover future capital requirements.
(3) Sales
Not applicable.
(4) Disposals
Not applicable.

42

BudgetaryAmountamountpaid(Millions of (Millions of
yen)
yen)
5,444

－

Remarks

Facility renovationwork

IV. Information on the Company
1. Information on the Company’s Stock, etc.
(1) Total Number of Shares, etc.
(i) Total Number of Shares
Class

Total number of shares authorized to be issued (shares)

Common shares

400,000,000

Total

400,000,000(ii) Shares issued

Class

As of the end of Fiscal
As of the Filing Date
Year
Number of shares
Number of sharesissued (shares)
issued (shares)(March 27, 2024)(December 31, 2023)

Names of Stock Exchanges on
which the Company is listed or
Names of Authorized Financial
Instruments Firms Association

Description

Common shares

209,167,674

209,167,674

Tokyo Stock Exchange
Prime Market

Number of sharesconstituting a unit
100 shares

Total

209,167,674

209,167,674－－(2) Status of Share Acquisition Rights(i) Stock Option Plans
Not applicable.
(ii) Rights Plan
Not applicable.
(iii) Other Information About Share Acquisition Rights
Not applicable.
(3) Status of Exercise of Bonds with Moving Strike Warrant
Not applicable.
(4) Trends in the Total Number of Shares Issued, Share Capital, etc.

Date

Change in total Balance of total
Balance
Changes in
Balance of
Changes in
number of
number ofof Share Capital Capital Reserve Capital Reserve
Share
Capitalshares issued
shares issued(Thousands of shares)

January 31, 2020 (Note)(Thousands of shares)(7,795)(Millions of yen) (Millions of yen) (Millions of yen) (Millions of yen)

209,167－

92,451－

63,729(Note) This was due to the retirement of treasury share on January 31, 2020.
(5) Status of Shareholders
As of December 31, 2023
Status of Shares (1 unit = 100 shares)
Foreign Shareholders
Category

National/Local

Financial

Securities

Foreign

Other

Governments Institutions Companies Corporations shareholders
Individuals

other than
individuals

Individuals
Other

Total

Status ofshares ofless than one
unit(shares)Number ofshareholders
55
33
302
373
27
16,201
16,991－－(Persons)
Number ofshares held
875,802
197,008
233,332
654,091321
129,114 2,089,668
200,874－(Unit)
Shareholding
41.91
9.43
11.17
31.30
0.01
6.18
100.0
－
－
Ratio (%)
(Note) Of the treasury share of 39,181 shares, 391 units are included under “Individuals/Other,” and 81 shares are included under“Shares of less than One Unit.”
The 225,300 shares held by the Board Benefit Trust (BBT) are not included in treasury share, but 2,253 units are included
under “Financial Institutions.”43

(6) Status of Major Shareholders
As of December 31, 2023
Number of
Shares held(Thousands ofshares)Shareholding ratio(excluding treasury
shares) (%)

2-11-3, Hamamatsucho, Minato-ku, Tokyo

37,96918.16

1-8-12, Harumi, Chuo-ku, Tokyo

21,74010.40

25 BANK STREET, CANARY WHARF,LONDON, E14 5JP, UNITED KINGDOM(2-15-1 Konan, Minato-ku, Tokyo)

5,367

2.57

UTRECHTSEWEG 91 ZEIST NL 3702 AA(6-27-30, Shinjuku, Shinjuku-ku, Tokyo)

5,064

2.42

Sompo Japan Insurance Inc.

1-26-1, Nishi-Shinjuku, Shinjuku-ku, Tokyo

4,744

2.27

Meiji Yasuda Life Insurance
Company(Standing proxy: Custody Bank ofJapan, Ltd.)

2-1-1, Marunouchi, Chiyoda-ku, Tokyo
(1-8-12, Harumi, Chuo-ku, Tokyo)

4,729

2.26

SMBC Nikko Securities Inc.

3-3-1, Marunouchi, Chiyoda-ku, Tokyo

4,335

2.07

1-9-7, Otemachi, Chiyoda-ku, Tokyo

4,040

1.93

2-7-3, Marunouchi, Chiyoda-ku, Tokyo

3,888

1.86

1-2-10, Nihonbashi Kayabacho, Chuo-ku, Tokyo

3,881

1.86

95,76045.79

Name of Shareholder

The Master Trust Bank of Japan,
Ltd. (Trust Account)
Custody Bank of Japan, Ltd. (Trust
Account)
JP Morgan Chase Bank 385632(Standing proxy: Settlement &Clearing Services Department,
Mizuho Bank, Ltd.)CB London Stichting
Pensioenfonds Zorg en Welzijn(Standing proxy: Citibank, N.A.,
Tokyo Branch)

Morgan Stanley MUFG Securities
Co., Ltd.
JPMorgan Securities Japan Co.,
Ltd.
JAPAN SECURITIES FINANCE
CO., LTD.

Address

Total(Note) 1. In the change report of the statements of large-volume holdings, which was made available for public inspection on
October 30, 2023, Mitsubishi UFJ Trust and Banking Corporation and its joint holder, Mitsubishi UFJ AssetManagement Co., Ltd., are listed as owning the following shares as of October 23, 2023. However, the Company isunable to confirm the actual status of the shareholdings of these shareholders as of December 31, 2023; thus, thoseshareholdings have not been reflected in the above list. The contents of said change report are as follows.
Number ofName of Shareholder

Address

shares held(Thousands ofShareholding Ratio(%)

shares)Mitsubishi UFJ Trust and Banking
Corporation
Mitsubishi UFJ Asset Management
Co., Ltd.

1-4-5, Marunouchi, Chiyoda-ku, Tokyo

5,427

2.59

1-9-1, Higashi-Shimbashi, Minato-ku, Tokyo

2,988

1.43

44

2. In the change report of the statements of large-volume holdings, which was made available for public inspection on
November 8, 2023, Nomura Securities Co., Ltd. And its joint holders Nomura International PLC, and Nomura AssetManagement Co., Ltd. Are listed as owning the following shares as of October 31, 2023. However, the Company isunable to confirm the actual status of the shareholdings of these shareholders as of December 31, 2023; thus, thoseshareholdings have not been reflected in the above list. The contents of said change report are as follows.
Number of
Shares held
Shareholding Ratio
Name of Shareholder
Address(%)(Thousandsof shares)
Nomura Securities Co., Ltd.

1-13-1, Nihonbashi, Chuo-ku, Tokyo

12

0.01

Nomura International PLC

1 Angel Lane, London EC4R 3AB, United
Kingdom

1,231

0.59

Nomura Asset Management Co.,Ltd.

2-2-1, Toyosu, Koto-ku, Tokyo

11,585

5.54

3. In the change report of the statements of large-volume holdings, which was made available for public inspection on
November 8, 2023, Asset Management One Co., Ltd. And its joint holders Mizuho Bank, Ltd., Mizuho Securities Co.,
Ltd. And Mizuho Trust & Banking Co., Ltd. Are listed as owning the following shares as of October 31, 2023. However,
the Company is unable to confirm the actual status of the shareholdings of these shareholders as of December 31, 2023;
thus, those shareholdings have not been reflected in the above list. The contents of said change report are as follows.

Name of Shareholder

Address

Number ofshares held(Thousandsof shares)

Shareholding Ratio(%)

Asset Management One Co., Ltd.

1-8-2, Marunouchi, Chiyoda-ku, Tokyo

8,273

3.96

Mizuho Bank, Ltd.

1-5-5, Otemachi, Chiyoda-ku, Tokyo

2,166

1.04

Mizuho Securities Co., Ltd.

1-5-1, Otemachi, Chiyoda-ku, Tokyo

1,341

0.64

Mizuho Trust & Banking Co., Ltd.

1-3-3, Marunouchi, Chiyoda-ku, Tokyo

1,261

0.60

4. In the change report of the statements of large-volume holdings, which was made available for public inspection on
December 6, 2023, Sumitomo Mitsui Trust Asset Management Co., Ltd. And its joint holder, Nikko Asset Management
Co., Ltd. Are listed as owning the following shares as of November 30, 2023. However, the Company is unable toconfirm the actual status of the shareholdings of these shareholders as of December 31, 2023; thus, those shareholdings
have not been reflected in the above list. The contents of said change report are as follows.

Name of Shareholder

Address

Number ofshares held(Thousandsof shares)

Shareholding Ratio(%)

Sumitomo Mitsui Trust AssetManagement Co., Ltd.

1-1-1, Shiba-Koen, Minato-ku, Tokyo

7,521

3.60

Nikko Asset Management Co., Ltd.

9-7-1, Akasaka, Minato-ku, Tokyo

6,052

2.89

45

5. In the change report of the statements of large-volume holdings, which was made available for public inspection on
December 20, 2023, BlackRock Japan Co., Ltd. And its joint holders BlackRock Advisors, LLC, BlackRock Financial
Management, Inc., BlackRock (Netherlands) BV, BlackRock Fund Managers Limited, BlackRock (Luxembourg) S.A.,
BlackRock Asset Management Canada Limited, BlackRock Asset Management Ireland Limited, BlackRock Fund
Advisors, BlackRock Institutional Trust Company, N.A. are listed as owning the following shares as of December 15,
2023. However, the Company is unable to confirm the actual status of the shareholdings of these shareholders as ofDecember 31, 2023; thus, those shareholdings have not been reflected in the above list. The contents of said changereport are as follows.

Name of Shareholder

Address

BlackRock Japan Co., Ltd.

1-8-3, Marunouchi, Chiyoda-ku, Tokyo

BlackRock Advisors, LLC

Number of
Shares held(Thousandsof shares)

Shareholding Ratio
(%)

4,682

2.24

251 Little Falls Drive, Wilmington, Delaware,
USA

351

0.17

BlackRock Financial Management,Inc.

251 Little Falls Drive, Wilmington, Delaware,
USA

466

0.22

BlackRock (Netherlands) BV

1 Amstelplein, HA1096, Amsterdam, The
Kingdom of the Netherlands

508

0.24

BlackRock Fund Managers Limited

12 Throgmorton Avenue, London, UK

1,324

0.63

BlackRock (Luxembourg) S.A.

35A J.F. Kennedy Street, L-1855, Grand Duchyof Luxembourg

423

0.20

BlackRock Asset Management Canada
Limited2500, 161 Bay Street, Toronto, Ontario, Canada

365

0.17

BlackRock Asset Management Ireland
LimitedFloor 1, 2 Ballsbridge Park, Ballsbridge, Dublin,
Republic of Ireland

1,178

0.56

BlackRock Fund Advisors

400 Howard Street, San Francisco, California,
USA

2,445

1.17

BlackRock Institutional Trust
Company, N.A.

400 Howard Street, San Francisco, California,
USA

3,385

1.62

6. In the change report of statements of large-volume holdings, which were made available for public inspection on January
11, 2024, SMBC Nikko Securities Inc. and its joint holder, Sumitomo Mitsui DS Asset Management Company, Limited
are listed as owning the following shares as of December 29, 2023. However, the Company is unable to confirm theactual status of the shareholdings of these shareholders as of December 31, 2023; thus, those shareholdings have not beenreflected in the above list. The contents of such statements of large-volume holdings are as follows.
Number ofName of Shareholder

Address

Shares held(Thousands

Shareholding Ratio(%)

of shares)
SMBC Nikko Securities Inc.

3-3-1, Marunouchi, Chiyoda-ku, Tokyo

4,343

2.08

Sumitomo Mitsui DS AssetManagement Company, Limited

1-17-1, Toranomon, Minato-ku, Tokyo

12,631

6.04

46

(7) Status of Voting Rights(i) Shares Issued
As of December 31, 2023
Number of Voting
Rights(Units)Number of shares(shares)Category
Shares without voting rights
Shares with restricted voting rights– treasury shares, etc.
Shares with restricted voting rights–other

－

－

－

－

－

－

－

－

－

39,100－－2,089,277－

Shares with full voting rights –treasury shares, etc.

CommonShares with full voting rights –otherCommonshares

208,927,700

Shares of less than one unit

Commonshares200,874

sharesTotal number of shares issued

Description－ Less than one unit (100 shares)

209,167,674－－

Total voting rights held by all
2,089,277－－
shareholders(Notes) 1. The following treasury shares are included in “Shares of less than one unit.”
Tokyo Tatemono Co., Ltd. 81 shares
2. Common stock indicated under “Shares with full voting rights – other” includes 225,300 shares of the Company (2,253
voting rights) held by the Board Benefit Trust (BBT). Said 2,253 voting rights are not exercised.
(ii) Treasury Share, etc.
As of December 31, 2023

Name of Shareholder

Address(Treasury shares)

1-9-9, Yaesu,

Tokyo Tatemono Co., Ltd.

Chuo-ku, Tokyo

Total

Number of
Shares held
under Own
Name(shares)Number of
Shares Heldunder theNames of
Others(shares)

Total Numberof Shares Held(shares)

Shareholding
Ratio (%)

39,100－39,1000.02

39,100－39,1000.02－(Note) 225,300 shares of the Company’s shares held by the Board Benefit Trust (BBT) are not included in the above treasury
shares, etc.
(8) Information on the Officer/Employee Stock Ownership Plan
Based on the resolution of the 200th Ordinary General Meeting of Shareholders (hereinafter referred to as the “Resolution ofthis General Meeting of Shareholders”) held on March 28, 2018, the Company has established the “Board Benefit Trust (BBT)”(hereinafter referred to as the “BBT scheme”), a share award plan for the Company’s Directors (excluding External Directors)
and Managing Officers who do not concurrently serve as Directors (hereinafter collectively referred to as “Directors, etc.”),intending to enhance their awareness to contribute to increasing the Company’s corporate value over the medium to long term.
A. Outline of the BBT Scheme
Under the BBT scheme, the Company’s shares are acquired through a trust (the trust to be established under the BBT scheme
is hereinafter referred to as the “Trust”) with funds contributed by the Company. This is a share award plan under which theCompany’s shares and money equivalent to the amount converted at the market value of the Company’s shares (hereinafterreferred to as “the Company’s shares, etc.”) are paid to Directors, etc. through the Trust in accordance with the “Regulationsof Directors’ Equity Benefit” (hereinafter referred to as the “Regulations”) stipulated by the Company. In principle, the time
when Directors, etc. receive the Company’s shares, etc. is at the time of their retirement from office.
Each fiscal year, Directors, etc. are granted a certain number of points in consideration of their position in accordance with theRegulations, and each point is converted into one share of common stock of the Company at the time of delivery of theCompany’s shares, etc. The total number of points to be granted to Directors, etc. per fiscal year shall be up to 60,000 points(including 40,000 points for Directors (excluding External Directors)).

47

<Structure of the BBT Scheme>(i) The Company shall set forth the Regulations to the extent approved by the Resolution of this General Meeting of
Shareholders.
(ii) The Company will place funds in trust to the extent approved by the Resolution of this General Meeting of Shareholders.
(iii) The Trust shall acquire the Company’s shares through the trading market, etc. using the funds entrusted in (ii) above as thesource.
(iv) The Company shall grant points to Directors, etc. per the Regulations.
(v) The Trust shall not exercise voting rights pertaining to the Company’s shares in the Trust in compliance with the instructionsof the Trust Administrator, which is independent of the Company.
(vi) The Trust shall grant the Company’s shares to retired Directors, etc. who satisfy the requirements for beneficiaries stipulated
in the Regulations (hereinafter referred to as “beneficiaries”) in proportion to the number of points granted to said
beneficiaries. Provided, if the requirements stipulated in the Regulations are met, a certain percentage of the shares shall be
paid in cash equivalent to the market value of the Company’s shares in lieu of the payment of the Company’s shares.
Further, the Trust reserves the right to sell the Company’s shares in order to provide monetary benefits.
b. Total Number or Total Amount of the Company’s Shares Scheduled to be Purchased by the Board Benefit Trust (BBT)The Company shall be subject to the following terms and conditions for the three fiscal years from the fiscal year ended thelast day of December 2018 through the fiscal year ended the last day of December 2020 (hereinafter referred to as the “Initial
Relevant Period” and the Initial Relevant Period and each of the three fiscal years beginning after the expiration of the Initial
Relevant Period shall be respectively referred to as the “Relevant Period”) and each Relevant Period afterwards. Upon the
introduction of the BBT scheme, the Company shall contribute the following amount of funds to the Trust as the source offunds for the acquisition of the Company’s shares by the Trust to provide the Company’s shares, etc. to Directors, etc. for theperiod covered by the BBT scheme.
The maximum allowable number of points to be granted to Directors, etc. under the BBT scheme is 60,000 points per fiscal
year (including 40,000 points for Directors (excluding External Directors)), as described above. Accordingly, at the time ofthe establishment of the Trust, the Company shall contribute to the Trust funds reasonably expected to be required for theacquisition of up to 180,000 shares, taking into consideration the closing price of the Company’s common stock in regular
trading on the Tokyo Stock Exchange immediately prior to the establishment of the Trust. Subsequently, until the terminationof the BBT scheme, the Company will, in principle, make additional contributions to the Trust for each Relevant Period, basedon a reasonably estimated number of shares required to provide benefits to Directors, etc. under the BBT scheme, and thefunds deemed necessary for the Trust to acquire such shares ahead of time. Provided, in the event of such additional
contribution, if there are any remaining shares of the Company or funds in the trust assets, they shall be allocated to the sourceof benefits under the BBT scheme, and the amount of such additional contribution for the subsequent Relevant Period shall becalculated after taking into consideration such remaining shares, etc.
Acquisition of the Company’s shares by the Trust shall be conducted through the trading market, etc. using the funds
contributed as described above as the source.
c. Scope of Beneficiary Rights and Other Rights under the Board Benefit Trust (BBT)
Directors, etc. who meet the requirements for beneficiaries as stipulated in the “Regulations of Directors’ Equity Benefit.”48

2. Information on Acquisition, etc. of Treasury Shares
Acquisition of shares of common stock under the condition set forth in
Article 155, Item 7 of the Companies Act

Class of shares(1) Acquisition of Treasury Shares based on a Resolution of General Meeting of Shareholders
Not applicable.
(2) Acquisition of Treasury Shares based on a Resolution of Board of Directors
Not applicable.
(3) Acquisition of Treasury Shares not based on a Resolution of General Meeting of Shareholders or Board of Directors
Acquisition pursuant to Article 155, Item 7 of the Companies Act
Category

Number of shares (shares)

Total value (yen)Treasury shares acquired in the current fiscal year

2,089

3,922,235

Treasury shares acquired during the current period

104

228,588(Note) The number of shares of treasury share acquired during the current period does not include the number of shares of lessthan one unit purchased during the period from March 1, 2024 until the filing date of this report.
(4) Status of Disposition and Holding of Acquired Treasury Shares

Current Fiscal Year
Category

Number of shares(shares)

Total Disposal
Amount(yen)

Current Period
Number of shares(shares)

Total Disposal
Amount(yen)

Acquired treasury shares that were－－－－
offered to subscribers for subscription
Acquired treasury shares that were－－－－canceled
Acquired treasury shares through amerger, stock swap, stock delivery, or－－－－
share transfer related to company split
Other (request for additional purchase
238
447,690－－of shares of less than one unit)
Number of shares of treasury shares
39,181
39,285－－held(Note) The number of shares of “Other” during the current period does not include shares resulting from requests for additionalpurchase of less than one unit during the period from March 1, 2024 until the filing date of this report.

49

3. Dividend Policy
Dividend policy is based on the basic policy of profit distribution, which is to strive to maintain and increase the level of stabledividends by comprehensively considering the future business environment, business development, and business performance
while enhancing internal reserves for reinvestment to increase corporate value. The Group’s basic policy is to maintain abaseline for dividend payout ratio of at least 30% during the period of the Group’s Medium-Term Business Plan (FY2020 toFY2024).
Dividends are paid twice a year: an interim dividend with a record date of June 30 and a year-end dividend with a record dateof December 31. The interim dividend is paid by resolution of the Board of Directors, and the year-end dividend is paid byresolution of the General Meeting of Shareholders.
In accordance with the above policy, the year-end dividend for the current fiscal year is set at 37 yen per share, which, together
with the interim dividend of 36 yen per share, totals 73 yen per share, resulting in a consolidated dividend payout ratio of
33.8% for the current fiscal year.
The Company’s Articles of Incorporation stipulate that the Company may pay interim dividends as prescribed in Paragraph 5,
Article 454 of the Companies Act.

(Note) The Dividends of surplus for which the record date belongs to the current fiscal year are as follows:
Date of Resolution

Total Dividend Amount(Millions of yen)

Dividend Amount per
Share
(yen)

August 10, 2023
Resolution of Board of Directors’
meeting

7,528

36

7,737

37

March 27, 2024
Resolution of the Ordinary General
Meeting of Shareholders50

4. Status of Corporate Governance, etc.
(1) Outline of Corporate Governance(ⅰ) Fundamental Policies for Corporate Governance
Under the corporate philosophy of “Trust beyond the era,” the Company strives to establish optimal corporate governancewith the main objective of achieving sustainable growth and increasing corporate value over the medium to long term while
ensuring sound and transparent management and increasing efficiency. To ensure that our shareholders and other stakeholders
accurately understand our business activities, we disclose information proactively and appropriately.
Further, we have established a “Compliance Charter” common to all Group companies as a part of our commitment to society
and to promote compliance-oriented corporate activities aiming to continue our sound corporate activities and earn the trustof society for many years to come.
(ⅱ) Outline of System of Corporate Governance and Reason for Adoption of said System
The Company has adopted the following corporate governance systems for efficient and sound group management: the Boardof Directors, Nomination and Remuneration Advisory Committee, Audit & Supervisory Board Member system, and Managing
Officer system, together with the establishment and operation of Group Management Meeting, Internal Control Committee,
Risk Management Committee, and Sustainability Committee.
a. Board of Directors
The Board of Directors is chaired by Makio Tanehashi, Chairman of the Board and Representative Director, who does notconcurrently serve as Chief Executive Officer, and consists of 12 members: 8 Internal Directors and 4 External Directors(including 1 female Director). In principle, the Board of Directors holds a regular meeting once a month and extraordinary
meetings are held as necessary to make decisions on important matters concerning the Company’s operation and supervise
the Directors’ execution of their duties. Further, Audit & Supervisory Board Members attend meetings of the Board of
Directors and express their opinions as necessary.
Chairman: Makio Tanehashi (Representative Director and Chairman of the Board)
Members: Makio Tanehashi (Representative Director and Chairman of the Board), Hitoshi Nomura (Representative
Director, President & Chief Executive Officer), Katsuhito Ozawa (Representative Director and Senior
Managing Executive Officer), Akira Izumi (Representative Director and Senior Managing Executive Officer),
Hideshi Akita (Director and Senior Managing Executive Officer), Takeshi Jinbo (Director and Managing
Executive Officer), Shinjiro Kobayashi (Director and Managing Executive Officer), Fumio Tajima (Director
and Managing Executive Officer), Shuichi Hattori (External Director), Yoshimitsu Onji (External Director),
Takeo Nakano (External Director), Yumiko Kinoshita (External Director)
b. Nomination and Remuneration Advisory Committee
The Nomination and Remuneration Advisory Committee is an advisory body to the Board of Directors to nominate candidates
for Director, select and dismiss Representative Directors, and deliberate on remuneration for Directors.
Committee Chairman: Hitoshi Nomura (Representative Director, President and Chief Executive Officer)
Members: Makio Tanehashi (Representative Director and Chairman of the Board), Hitoshi Nomura (Representative
Director, President and Chief Executive Officer), Akira Izumi (Representative Director and Senior Managing
Executive Officer), Shuichi Hattori (External Director), Yoshimitsu Onji (External Director), Takeo Nakano(External Director), Yumiko Kinoshita (External Director)
c. Audit & Supervisory Board system
The Company, adopting a system of a company with an Audit & Supervisory Board, has an Audit & Supervisory Board
consisting of four members, including two full-time Audit & Supervisory Board members (Takashi Yoshino, Isao Jinno) andtwo External Audit & Supervisory Board members (Sayaka Hieda, Naohiro Chikada), and chaired by Takashi Yoshino, afull-time Audit & Supervisory Board member, and that receives reports about important matters on audits and then discusses
and resolves such matters.
d. Managing Officer system
The Company has adopted a Managing Officer system to strengthen management functions and business execution functions,stimulate the Board of Directors and accelerate the decision-making process. Managing Officers are appointed by resolutionof the Board of Directors, and there are 22 Managing Officers as of March 27, 2024.

51

e. Group Management Meeting
The Group Management Meeting is an organization that deliberates on important matters related to the management of The
Company and affiliated companies, etc. with Representative Director, President and Chief Executive Officer Hitoshi Nomura
as chairperson and Managing Officers with specific responsibilities. In addition, full-time Audit & Supervisory Board
members attend the Group Management Meeting and share opinions as necessary.
f. Internal Control Committee
The Internal Control Committee is an organization that deliberates on the development, operation status, and improvement
measures of internal control systems within the Group with Representative Director, President and Chief Executive Officer
Hitoshi Nomura as chairperson and the Chairman of the Board, Executive Vice President and Executive Officer and the
Director in charge of the Corporate Planning Department as members. Full-time Audit & Supervisory Board members attend
Internal Control Committee meetings and share opinions when necessary. Matters discussed by the Committee are submitted
or reported to the Board of Directors as necessary.
g. Risk Management Committee
The Risk Management Committee is an organization that oversees the Group’s risk management and compliance withRepresentative Director, President and Chief Executive Officer Hitoshi Nomura as chairperson and the Chairman of the Board,
Executive Vice President and Executive Officer, Division Directors and Vice Division Directors of each division, the Director
in charge of the Corporate Planning Department, and General Managers of corporate departments, etc. as members. Full-time
Audit & Supervisory Board members attend Risk Management Committee meetings and share opinions as necessary. To
promote compliance management, a Compliance Subcommittee (Subcommittee Chairman: Director in charge of Legal &Compliance Department) has been established as a subordinate organization of this committee to discuss compliance measures,monitor progress, respond to compliance risks, and to address risks associated with disasters, and a Business Continuity
Management Subcommittee (Subcommittee Chairman: Director in charge of General Affairs Department) has also been set
up for monitoring BCP responses, creating and improving BCP manuals, sharing BCP initiatives in Group companies, andformulating improvement policies for BCP. The Committee reports matters deliberated and reported to the Board of Directors
and submits cases that should be submitted to the Board of Directors as necessary.
h. Sustainability Committee
The Sustainability Committee has the Representative Director, President and Chief Executive Officer Hitoshi Nomura as
chairperson and Directors (excluding External Directors), Managing Officers with assigned roles, each General Manager ofthe corporate departments, the General Manager of the Engineering Division of the Commercial Properties business, and othermembers appointed by the chairperson as members in consideration of their expertise in the matters to be discussed, and it
deliberates and discusses matters related to the formulation of the Group's sustainability policy, the development of systems,
the setting of metrics and targets, and the monitoring and evaluation of progress. Full-time Audit & Supervisory Board
members attend Sustainability Committee meetings and share opinions as necessary. Important matters deliberated anddiscussed by the committee are submitted to the Board of Directors, which makes decisions on important sustainability-related
matters and monitors and supervises the status of the Company's response to such matters. The Sustainability Promotion
Committee and the Human Rights Subcommittee have been established as subordinate organizations of the committee, andthe Sustainability Promotion Committee shares decisions made by the committee, discusses matters for consideration inadvance, and reports and discusses the progress of the sustainability promotion by the Group. The Human Rights
Subcommittee implements decisions made by the Sustainability Committee and reports and discusses the status of humanrights initiatives.

52

(Corporate governance structure chart as of March 27, 2024)<Reason for Adoption of Corporate Governance System>
To ensure sound and transparent management while increasing efficiency, the Company has adopted the status of aCompany with Audit & Supervisory Board and a Managing Officer system.
The Audit & Supervisory Board has strengthened oversight functions and ensured transparency of management through theappointment of External Audit & Supervisory Board members while the Managing Officer system has clarified the divisionof functions for management and business execution, strengthening management/oversight and business execution functions.
Thus, the Company believes that a system has been established in which The Company’s management and Director
monitoring/oversight functions are sufficiently performed.

53

(iii) Activities of the Board of Directors
The Company held a total of 14 meetings of the Board of Directors during the current fiscal year. The attendance record ofeach member is as follows.
Title

Name

Meeting attendance

Representative Director
and Chairman of the
Board

Makio Tanehashi

14/14 times

Hitoshi Nomura

14/14 times

Katsuhito Ozawa

14/14 times

Akira Izumi

14/14 times

Hideshi Akita

14/14 times

Takeshi Jinbo

13/14 times

Shinjiro Kobayashi

11/11 times(Note) 1

Fumio Tajima

11/11 times(Note) 1

Director

Kengo Fukui

3/3 times(Note) 2

Director

Hisatoshi Kato

3/3 times(Note) 2

External Director

Shuichi Hattori

13/14 times

External Director

Yoshimitsu Onji

14/14 times

External Director

Takeo Nakano

14/14 times

External Director

Yumiko Kinoshita

14/14 times

Representative Director
President & Chief
Executive Officer
Representative Director
Senior Managing
Executive Officer
Representative Director
Senior Managing
Executive Officer
Director
Senior Managing
Executive Officer
Director
Managing Executive
Officer
Director
Managing Executive
Officer
Director
Managing Executive
Officer(Notes) 1. Shinjiro Kobayashi and Fumio Tajima were both elected at the 205th Ordinary General Meeting of Shareholders heldon March 29, 2023, and their attendance at the Board of Directors meetings held after that date is shown.
2. Kengo Fukui and Hisatoshi Kato both retired from their positions at the 205th Ordinary General Meeting of
Shareholders held on March 29, 2023, and their attendance at the Board of Directors meetings held on or before thatdate is shown.

54

The specific considerations by the Board of Directors are as follows.
Classification
Specific considerations
Business andfinance●Approval of annual accounts, budget, business plan, financial
plan, and investment policy●Approval of medium-term rolling(E) Approval of setting environment-related KPIs and targets,accelerating and enhancing the achievement of some targets

Matters related to

ESG(S) Identification of priority issues related to human rights andreview of due diligence

management strategy

E: environment
S: social(G) Verification of the significance of holding shares and review
policy regarding strategic shareholdings

G: governance(G) Confirmation of the results of the evaluation of theeffectiveness of the Board of Directors and consideration ofways to further improve the effectiveness of the Board of
Directors

Other

Matters regarding shares

Other matters●Sharing IR activity reports and the contents of feedback●Convening of General Meeting of Shareholders anddetermination of proposals to be submitted●Approval of appropriation of retained earnings and dividend
policy●Progress report on major projects(iv) Activities of the Nomination and Remuneration Advisory Committee
The Company held a total of 4 meetings of the Nomination and Remuneration Advisory Committee during the current fiscal
year. The attendance record of each member is as follows.
Title

Name

Meeting attendance

Representative Director
President & Chief Executive Officer

Hitoshi Nomura

4/4 times

Representative Director andChairman of the Board

Makio Tanehashi

4/4 times

Akira Izumi

4/4 times

External Director

Shuichi Hattori

3/4 times

External Director

Yoshimitsu Onji

4/4 times

External Director

Takeo Nakano

4/4 times

External Director

Yumiko Kinoshita

4/4 times

Representative Director
Senior Managing Executive Officer

The specific considerations by the Nomination and Remuneration Advisory Committee are as follows.
・Election of candidates for Directors and Audit & Supervisory Board Members・Election of Managing Officers
・Responsibilities of Directors and Managing Officers
・Remuneration of Directors and Managing Officers (by individual)(v) Other Matters Regarding Corporate Governance
Along with setting the corporate philosophy of “Trust beyond the era” and earning the trust of customers as the basis for
conduct of all officers and employees, the Company has developed a system to secure business integrity (hereinafter, “internal
control system”) and works to have same functioning thoroughly.

55

a. System to Ensure Directors’ and Employees’ Execution of Duties in Compliance with Laws, Regulations, and the Articles
of Incorporation
・The Company has set forth thorough compliance as a basic policy of management and has established “Compliance
Rules” in addition to developing a compliance system based on those rules.
・The Company has established a Risk Management Committee chaired by the President & Chief Executive Officer tooversee the Group’s risk management and compliance. The committee works to appropriately operate and improve thecompliance system.
・The Risk Management Committee reports to the Board of Directors and Audit & Supervisory Board on the status of theoperation, etc. of the compliance system when necessary.
・The Company has set forth “Whistleblower Rules” to establish a system for officers and employees to report any wrongfulacts and compliance issues found, established contact points inside and outside the company for reporting by officers andemployees and made officers and employees aware of these matters.
・The Company promptly conducts the necessary investigations of matters reported pursuant to the “Whistleblower Rules”
and takes corrective measures and preventive measures as needed.
・The Company develops a system to prevent persons who report wrongful acts or other compliance incidents to a reporting
contact point from being treated unfavorably due to the reason of reporting.
・The Company has established “Rules on the Exclusion of Antisocial Forces” and takes a firm stance to allow no
relationship with antisocial forces that threatens the order and safety of civil society.
b. Systems to Keep and Manage Information on Directors’ Execution of Duties
・The Company has established a Document Management Administration Department and an Information Management
Supervisor based on the “Document Management Rules” and “Information Management Rules” for documents (including
electronic records) pertaining to Directors’ execution of duties and other information and appropriately stores andmanages these in accordance with the provisions thereof.
c. Rules and Other System for Management of Risks of Loss
・The Company has established “Risk Management Rules” to manage the Group’s risks and maximize corporate value andcontinuously monitors and responds to risks pertaining to the operations of each department and also comprehensively
manages the Group’s risks through the Risk Management Committee.
・The Risk Management Committee performs evaluation and analysis of the Group’s risks, deliberates measures to preventthe occurrence of risks and address risks that actualize as well as prevent a recurrence, and submits cases or reports to theBoard of Directors when necessary.
・The Internal Audit Department evaluates the appropriateness and effectiveness of the risk management system and risk
management operations and reports the results of its investigations to the President & Chief Executive Officer and the
Audit & Supervisory Board members, etc. on a periodic basis.
・The Company has established a basic plan on the handling of emergencies such as large earthquakes, has established asystem for business continuity in the event of an emergency based on the basic plan, and tracks and inspects the status of
preparation of crisis management drills, etc.
d. System to Ensure Directors’ Execution of Duties in an Efficient Manner
・The Company adopts a Managing Officer system to strengthen management functions and business execution functions,stimulate the Board of Directors and accelerate the decision-making process.
・The Board of Directors determines the Group’s management plans, annual business plans and budgets, and funding plans
based on consideration of the appropriate allocation of management resources, works to improve the efficiency andeffectiveness of operations, receives reports of the status of achievement of targets of each department on a periodic basis,
based on which it revises targets, and decides on improvements for greater efficiency of the business execution system
when necessary.
・The Company has stipulated “Organization Rules,” “Duty Authorization Rules,” and “Approval Rules” for the organizedand efficient execution and management of the operations of each department and clarifies the operations and authority ofeach division and the decision-makers for each operation.

56

e. System to Ensure Business Integrity of Corporate Group Comprising The Company and its Subsidiaries
・The Company has established the Group’s internal control systems to engage in Group management with the aim of
maximizing the corporate value of the Group.
・The Company has established an Internal Control Committee chaired by the President & Chief Executive Officer for the
improvement and enhancement of the Group’s internal control systems. The committee implements monitoring of theestablishment and status of operation of the Group’s internal control system.
・The Company has stipulated a “Group Compliance Charter,” “Compliance Code of Conduct,” and “Group Compliance
Manual” based on the “Compliance Rules,” works to notify the Group and its officers and employees of same throughtraining, etc. and creates systems for executing operations in a sincere manner with thorough compliance.
・The Risk Management Committee deliberates matters related to risks and compliance in the Group and oversees risk
management and compliance in the Group.
・The Company has established an Group Management Meeting chaired by the President to engage in Group managementwith the aim of maximizing corporate value of the Group as a whole. The meeting deliberates important mattersconcerning the Group and shares the status of business execution and other matters related to management based on the“Group Management Meeting Rules.”・The Company has established a Sustainability Committee chaired by the President & Chief Executive Officer to balance“resolution of social issues” and “growth as a company” at a higher level. The committee promotes initiatives aimed atsustainable growth of the Group and the realization of a sustainable society based on the “Sustainability Promotion
Rules.”・In order to enhance management efficiency of the Group and realize Group synergy, The Company performs management
control of Group companies based on the “Group Management Control Rules,” e.g. requiring The Company’s approval
for important decisions such as the business plans of Group companies as well as matters concerning compliance asmatters reportable to The Company.
・The Company develops a system to verify business integrity, such as by requiring Group companies’ officers andemployees to report on the status of their execution of duties on a periodic basis through such means as dispatching The
Company’s Directors, etc. to Group companies. In addition, The Company’s Directors monitor Group companies’
business plans and profit plans every fiscal year and report to the Board of Directors.
・The Company has established Group-wide reporting contact points outside the company for officers and employees of theGroup to report any wrongful acts and other compliance issues found and notifies officers and employees of the Groupaccordingly. The Company conducts necessary investigations of matters reported pursuant to the “Whistleblower Rules”
and necessary preventive measures as a Group.
・Based on the Financial Instruments and Exchange Act, The Company has developed a system that ensures appropriatenessof financial reporting by establishing a basic policy for financial reporting to ensure appropriateness of financial reportingin the Group.
・The Internal Audit Department implements internal audits of The Company and Group companies based on the “Internal
Control Rules” and reports the results to the President & Chief Executive Officer and Audit & Supervisory Board
members, etc.
f. System for Audit & Supervisory Board Members Seeking Assignment of Employees to Support Their Duties and Matters
Related to Ensuring Independence of the Employees from Directors and the Effectiveness of Instructions to the Employees
・The Company assigns personnel as auditing staff upon request from the Audit & Supervisory Board to smoothly execute
their supervisory duties.
・When supporting the duties of Audit & Supervisory Board members, the auditing staff shall follow the directions andorders of Audit & Supervisory Board members and are not subject to the directions or orders of Directors, the General
Manager of the Internal Audit Department, etc.
・Even if the auditing staff concurrently serves other departments, the operations as auditing staff take priority, and The
Company is required to obtain the prior consent of full-time Audit & Supervisory Board members to make personnel
changes or take disciplinary action for the auditing staff.

57

g. System for Reporting, etc. to Audit & Supervisory Board
・The Company mandates the attendance of Audit & Supervisory Board members at Board of Directors’ meetings, GroupManagement Meeting, and the Internal Control Committee meetings.
・In the event of the occurrence of a fact that may severely harm the Group or a serious violation of laws, regulations, or thearticles of incorporation, Directors promptly report the details to the Audit & Supervisory Board members.
・The Risk Management Committee promptly reports important compliance matters to the Audit & Supervisory Board
members.
・The Internal Audit Department reports on a periodic basis the status of internal audits to the Audit & Supervisory Board
members.
・The Legal & Compliance Department reports on a periodic basis the status of reports of wrongful acts, etc. and the content
thereof to the Audit & Supervisory Board members.
・The Company has developed a system to prevent persons who report wrongful acts or other compliance incidents to Audit& Supervisory Board members from being treated unfavorably due to the reporting.
h. Procedures for Advance Payment or Reimbursement of Expenses Arising in the Execution of Duties of Audit & Supervisory
Board Members and Other Policies Pertaining to the Processing of Expenses and Obligations Arising in the Execution of
Duties Thereof
・When requested by Audit & Supervisory Board members for advance payment, redemption, etc. of expenses arising fromthe Audit & Supervisory Board members’ execution of duties, The Company promptly processes those expenses or
obligations unless otherwise found to be unnecessary to the concerned Audit & Supervisory Board members’ execution ofduties.
i. Other Systems to Ensure Effective Auditing
・The Company has developed a system for Audit & Supervisory Board members to receive reports on a periodic basis fromthe Accounting Auditor, Directors and each department, and exchange opinions with the individual bodies at any time.
・The Internal Audit Department works to closely exchange information and coordinate with Audit & Supervisory Board
members concerning the formulation of internal audit plans and the results of internal audits.
(vi) Summary of the Liability Limitation Contract
In accordance with the provisions in Article 427, Paragraph 1 of the Companies Act, the Company has concluded a contract
with each Director (excluding Executive Directors, etc.) and each Audit & Supervisory Board Member to limit their liability
for damages as specified in Article 423, Paragraph 1 of the Companies Act. The amount of the limit for the liability for damages
under this contract shall be the amount specified by laws and regulations. Such limitation of liability shall be permitted only
when each of said Directors (excluding those who are Executive Directors, etc.) or Audit & Supervisory Board Members have
performed their duties that caused the liability in good faith and without gross negligence.
(vii) Summary of the Directors and Officers Liability Insurance Contract
The Company has entered into a Directors and Officers Liability Insurance contract with an insurance company pursuant toParagraph 1, Article 430-3 of the Companies Act. The insurance covers litigation expenses and legal damages to be borne by
the insured arising from the execution of his or her duties. As a measure to prevent impairment of the appropriateness of theexecution of the duties of the insured, the insurance contract does not cover damages, etc. arising from the insured’s criminalacts. The parties insured under the Directors and Officers Liability Insurance contract are Directors, Audit & Supervisory
Board Members, and Managing Officers of the Company, and the premiums for all insured shall be borne by the Company.
(viii) Number of Directors
The Company’s Articles of Incorporation stipulate that the Company shall have no more than 12 Directors.
(ix) Requirement for Appointment of Directors
Our Articles of Incorporation prescribe that resolution to appoint Directors shall be made by a majority vote of the voting
rights of shareholders present at a General Meeting of Shareholders, where such shareholders present shall hold shares
representing one-third or more of the voting rights of all shareholders who are entitled to exercise said voting rights and that
resolutions to appoint Directors shall not be adopted by cumulative voting.
(x) Acquisition of Treasury Shares
The Company stipulates in the Articles of Incorporation that the Company may acquire its own shares by resolution of theBoard of Directors in accordance with Paragraph 2, Article 165 of the Companies Act. The purpose of this is to carry out aflexible capital policy.

58

(xi) Interim dividend
In accordance with the provisions of Paragraph 5, Article 454 of the Companies Act, the Company stipulates in the Articles
of Incorporation that interim dividends may be paid by resolution of the Board of Directors with the record date of June 30 ofeach year. This is intended to flexibly return profits to shareholders.
(xii) Directors and Audit & Supervisory Board Members Exemption from Liability
The Company’s Articles of Incorporation stipulate that the liability for damages of Directors (including former Directors) and
Audit & Supervisory Board Members (including former Audit & Supervisory Board Members) for the negligence of theirduties may be exempted by a resolution of the Board of Directors to the extent permitted by law, pursuant to Paragraph 1 of
Article 426 of the Companies Act, in order to enable them to fully fulfill their expected roles in the performance of their duties.
(xiii) Requirements for Special Resolution of General Meeting of Shareholders
The Articles of Incorporation stipulate that the special resolution at the General Meeting of Shareholders defined in Paragraph
2, Article 309 of the Companies Act shall be made by not less than two-thirds of the voting rights of the shareholders present
at the meeting, where the shareholders holding not less than one-third of such voting rights of the shareholders that are entitled
to exercise their voting rights are present.

59

(2) Directors and Audit & Supervisory Board Members(i) List of Directors and Audit & Supervisory Board Members
Male: 14 persons; Female: 2 persons (accounting for 12.5% of the total number of Directors and Audit & Supervisory
Board Members)

Official title or position

Name

Date of BirthBusiness Experience and Position(s) and Office(s)Number of
Office shares held
Term (Thousandsof shares)

April 1979
March 2006

Representative Director andChairman of the Board

Makio Tanehashi

March 13, 1957

Joined The Fuji Bank, Limited
Executive Officer, General Manager of Internal
Audit Division of Mizuho Corporate Bank, Ltd.
April 2008
Managing Executive Officer and Officer incharge of Sales of Mizuho Corporate Bank, Ltd.
June 2011
Deputy President and Executive Officer, in chargeof Branches Department of Mizuho Bank, Ltd.
June 2011
Representative Director, Deputy President andExecutive Officer, in charge of Branches
Department of Mizuho Bank, Ltd.
March 2013 President and Chief Executive Officer of Tokyo
Tatemono Real Estate Sales Co., Ltd.
July 2015
Senior Managing Executive Officer and Division
Director of Asset Service Division of theCompany(Note) 4
March 2016 Senior Managing Executive Officer, Director,
Division Director of Asset Service Division andDivision Director of Overseas Business Divisionof the Company
January 2017 Representative Director, Chairman and Executive
Officer of the Company
Director and Chairman of the Board of Tokyo
Tatemono Real Estate Sales Co., Ltd.
March 2019 Representative Director and Chairman of theBoard of the Company (to present)
January 2021 Director of Tokyo Tatemono Real Estate Sales
Co., Ltd. (to present)
March 2023 External Director of Sapporo Holdings Limited(to present)
April 1981
March 2005

Representative Director
President & Chief Executive
Officer

Representative Director
Senior Managing Executive
Officer
Division Director ofCommercial Properties
Division

Hitoshi Nomura

Katsuhito Ozawa

Joined the Company
General Manager of Property Management
Department of the Company
March 2008 Director, and General Manager of Property
Planning Department of the Company
March 2011
Managing Director, and Division Director ofCommercial Properties Division responsible for
Kansai Branch and Kyushu Branch of theCompany
March 2013 Managing Executive Officer and Director; andDivision Director of Commercial Properties
October 10, 1958
(Note) 4
Division responsible for Kansai Branch, Sapporo
Branch, Kyushu Branch
and Nagoya Branch of the Company
March 2015 Senior Managing Executive Officer and Director
responsible for Personnel Department, Corporate
Planning Department, and General Affairs
Department of the Company
January 2017 President and Chief Executive Officer, andRepresentative Director of the Company (topresent)
Joined the Company
April 1987
March 2007 General Manager of Residential Management
Business Department of the Company
Director and General Manager of FinanceJuly 2009
Department of Tokyo Realty Investment
Management, Inc.
Managing Officer and General Manager ofFebruary 1, 1964 March 2015
(Note) 4
Corporate Planning Department of the Company
January 2017 Managing Executive Officer; Division Director ofOverseas Business Division and Leisure Business
Division responsible for Corporate
Communications Department, Finance
Department, Accounting Department andAppraisal Department; and General Manager of

30

60

23

17

Official title or position

Name

Date of BirthBusiness Experience and Position(s) and Office(s)Number of
Office shares held
Term (Thousandsof shares)

Finance Department and Overseas Business
Department of the Company
March 2017

August 2017

January 2019

January 2020

January 2021

April 2021

January 2022

January 2023

March 2023

April 1987
March 2009
March 2015
Representative Director
Senior Managing Executive
Officer

Akira Izumi

March 6, 1965

January 2017

March 2017

61

Managing Executive Officer and Director;
Division Director of Overseas Business Divisionand Leisure Business Division responsible for
Corporate Communications Department, Finance
Department, Accounting Department andAppraisal Department; and General Manager ofFinance Department and Overseas Business
Department of the Company
Managing Executive Officer and Director;
Division Director of Overseas Business Divisionand Leisure Business Division responsible for
Corporate Communications Department, Finance
Department, Accounting Department andAppraisal Department; and General Manager ofOverseas Business Department of the Company
Managing Executive Officer and Director;
Division Director of Overseas Business Division
responsible for Corporate Communications
Department, Finance Department, andAccounting Department; and General Manager ofOverseas Business Department of the Company
Managing Executive Officer and Director;
Division Director of Overseas Business Division
responsible for Corporate Communications
Department, Finance Department, andAccounting Department; and General Manager ofOverseas Business Department of the Company
Senior Managing Executive Officer and Director;
Division Director of Overseas Business Division;
Division Director of Commercial Properties
Division responsible for Acquisitions & Sales
Department (joint responsibility), Kansai Branch,
Sapporo Branch, Kyushu Branch and Nagoya
Branch of the Company
Senior Managing Executive Officer and Director;
Division Director of Commercial Properties
Division responsible for Acquisitions & Sales
Department (joint responsibility), Kansai Branch,
Kyushu Branch and Nagoya Branch of theCompany
Senior Managing Executive Officer and Director;
Division Director of Commercial Properties
Division responsible for Overseas Business,
Acquisitions & Sales Department (joint
responsibility), Kansai Branch, Kyushu Branch
and Nagoya Branch of the Company
Representative Director, Senior Managing
Executive Officer; Division Director ofCommercial Properties Division responsible forOverseas Business, Acquisitions & Sales
Department (joint responsibility), Kansai Branch,
Kyushu Branch and Nagoya Branch of theCompany
Representative Director, Senior Managing
Executive Officer; Division Director ofCommercial Properties Division responsible for
Leisure Business and Acquisitions & Sales
Department (joint responsibility), Kansai Branch,
Kyushu Branch and Nagoya Branch of theCompany (to present)
Joined the Company
General Manager of Retail Management
Department of the Company
Managing Officer and General Manager of Urban
Development Department of the Company
Managing Executive Officer responsible for(Note) 4
Personnel Department, Corporate Planning
Department, and General Affairs Department; andGeneral Manager of Corporate Planning
Department of the Company
Managing Executive Officer and Director
responsible for Personnel Department, Corporate

8Official title or position

Name

Date of BirthBusiness Experience and Position(s) and Office(s)January 2019

July 2019

January 2020

January 2021

January 2022

January 2023

April 1987
March 2006
January 2016
Director
Senior Managing Executive
Officer
Division Director of
Residential Development
Division and Division
Director of Asset Service
Division of the Company

January 2017

Hideshi Akita

May 18, 1964

January 2019

March 2019

January 2023

62

Number of
Office shares held
Term (Thousandsof shares)

Planning Department, and General Affairs
Department; and General Manager of Corporate
Planning Department of the Company
Managing Executive Officer and Director
responsible for Personnel Department, Corporate
Planning
Department,
GeneralAffairs
Department, and Appraisal Department; andGeneral Manager of Corporate Planning
Department of the Company
Managing Executive Officer and Director
responsible for Personnel Department, Corporate
Planning
Department,
GeneralAffairs
Department, and Market Research Department;
and General Manager of Corporate Planning
Department of the Company
Managing Executive Officer and Director
responsible for Personnel Department, Corporate
Planning
Department,
GeneralAffairs
Department, Market Research Department,
Solution Service Department (joint responsibility)
and ICT and Digital Strategy Promotion
Department of the Company
Senior Managing Executive Officer and Director
responsible for Corporate Communications
Department, Personnel Department, Corporate
Planning
Department,
GeneralAffairs
Department, Finance Department, Accounting
Department, Market Research Department, ICT
and Digital Strategy Promotion Department, andAcquisitions & Sales Department (joint
responsibility) of the Company
Senior Managing Executive Officer and Director
responsible for Corporate Communications
Department, Personnel Department, Corporate
Planning Department, Sustainability Management
Department, General Affairs Department, Finance
Department, Accounting Department, Market &Policy Research Department, DX Promotion
Department and Acquisitions & Sales Department(joint responsibility) of the Company
Representative Director, Senior Managing
Executive Officer responsible for Corporate
Communications
Department,
Personnel
Department, Corporate Planning Department,
Sustainability Management Department, General
Affairs Department, Legal & ComplianceDepartment, Finance Department, Accounting
Department, Market & Policy Research
Department, DX Promotion Department andAcquisitions & Sales Department (joint
responsibility) of the Company (to present)
Joined the Company
General Manager of Residential Management
Business Department of the Company
Managing Officer and General Manager of
Personnel Department of the Company
Managing Officer and Vice Division Director of
Residential Development Division of theCompany
Managing Executive Officer and Division(Note) 4
Director of Residential Development Division of
the Company
Managing Executive Officer and Director; andDivision Director of Residential Development
Division of the Company
Senior Managing Executive Officer and Director;
Division Director of Residential Development
Division and Division Director of Asset Service
Division of the Company (to present)5Official title or position

Director
Managing Executive Officer
Vice Division Director of
Residential Development
Division

Name

Takeshi Jinbo

Date of BirthBusiness Experience and Position(s) and Office(s)Number of
Office shares held
Term (Thousandsof shares)

April 1988
Joined the Company
January 2015 General Manager of Acquisitions Department of
the Company
January 2018 Managing Officer and General Manager ofAcquisitions Department of the Company
January 2019 Managing Officer; Vice Division Director of
Residential Development Division; and General
Manager of Acquisitions Department of theCompany
January 2021 Managing Executive Officer; Vice Division
Director of Residential Development Division
responsible for Solution Service Department(joint responsibility), Acquisitions Department,
and Project Development Department of the
February 27, 1965
(Note) 4
Company
March 2021 Managing Executive Officer and Director; Vice
Division Director of Residential Development
Division responsible for Solution Service
Department (joint responsibility), Acquisitions
Department, and Project Development
Department of the Company
January 2022 Managing Executive Officer and Director; Vice
Division Director of Residential Development
Division responsible for Business Development
Department, Acquisitions Department and Project
Development Department of the Company (topresent)
April 1988
March 2015

Director
Managing Executive Officer
Vice Division Director of Shinjiro Kobayashi
Commercial Properties
Division

August 23, 1965

Joined the Company
General Manager of Business Planning
Department of Commercial Properties Division of
the Company
January 2018 Managing Officer and General Manager of Urban
Development Department of the Company
January 2022 Managing Officer; Responsible for Urban
Development Department (2); General Manager
of Urban Development Department (1) of theCompany
January 2023 Managing Executive Officer; Vice Division(Note) 4
Director of Commercial Properties Division;
Responsible for Urban Development Department(2); General Manager of Urban Development
Department (1) of the Company
March 2023 Managing Executive Officer and Director; Vice
Division Director of Commercial Properties
Division; Responsible for Urban Development
Department (2); General Manager of Urban
Development Department (1) of the Company (topresent)

6

April 1990
April 2014

Director
Managing Executive Officer
Division Director ofOverseas Businesses
Division

Fumio Tajima

Joined The Fuji Bank, Limited
General Manager of Sales Department No. 17 ofMizuho Bank, Ltd.
April 2014
General Manager of Corporate Coverage
Department VII of Mizuho Securities Co., Ltd.
(retired in April 2019)
April 2018
Executive Officer, General Manager of Sales
Department No. 17 of Mizuho Bank, Ltd.
April 2019
Executive Officer, General Manager of Global
Products Coordination Department of Mizuho
Financial Group, Inc.
September 9, 1967
(Note) 4
April 2019
Executive Officer, General Manager of Global
Products Coordination Department of Mizuho
Bank, Ltd.
April 2021
Managing Officer; Division Director of Overseas
Business Division of the Company
January 2023 Managing Executive Officer; Division Director ofOverseas Business Division of the Company
March 2023 Managing Executive Officer and Director; andDivision Director of Overseas Business Divisionof the Company (to present)

7

63

3

Official title or position

Name

Date of BirthBusiness Experience and Position(s) and Office(s)Number of
Office shares held
Term (Thousandsof shares)

April 1984
July 1988

Director(Note)1

Shuichi Hattori

Registered as a lawyer
Established Hattori Law Firm (currently Hattori
General Law Firm) (to present)
June 2004
External Audit & Supervisory Board Member of
USHIO INC. (retired in June 2016)
April 2007
Lecturer (in charge of Financial Instruments andExchange Act) at Keio University Law School(retired in March 2023)
March 2009 External Audit & Supervisory Board Member of
LOOK INCORPORATED (currently LOOK
November 25, 1953
(Note) 4
HOLDINGS INCORPORATED) (retired in
March 2019)
January 2013 External Audit & Supervisory Board Member of
POKKA SAPPORO Food & Beverage Ltd.
(retired in March 2016)
March 2015 External Audit & Supervisory Board Member of
the Company (retired in March 2019)
June 2016
External Director of USHIO INC. (retired in June
2018)
March 2019 External Director of the Company (to present)
April 1977
April 1994
September
1998
December
1999
March 2000

Director(Note)1

Yoshimitsu Onji

April 2009
April 2010

June 2010
Director(Note)1

Takeo Nakano

Joined The Daiei, Inc.
General Manager of Corporate Planning Divisionof The Daiei, Inc.
Director and Vice President of R.E. Partners, Co.,
Ltd. (retired in April 2000)
CEO of OZ Corporation (to present)

Managing Executive Officer of RECOF Office(currently RECOF Corporation)
June 2007
Director and Chief Corporate Officer of RECOF
Corporation
June 2010
President and Chief Executive Officer of RECOF
Corporation
October 2016 Chairman and Representative Director of RECOF
November 1, 1954
(Note) 4
Corporation (retired in September 2017)
DecemberDirector of M&A Capital Partners Co., Ltd.
2016
(retired in September 2017)
March 2018 External Director of the Company (to present)
April 2018
Chairman and Director of Hongo Tsuji Business
Consulting Co., Ltd. (retired in November 2018)
June 2018
External Director of NIHON CHOUZAI Co., Ltd.
(to present)
DecemberOutside Audit & Supervisory Board Member of
2019
United Foods International Co., Ltd. (to present)
June 2020
External Director of Sotetsu Holdings Co., Ltd. (topresent)
December
External Director of Sanyu Appraisal Corporation
2021(to present)
April 1980
April 2007

June 28, 1956

April 2012

April 2013
April 2017
June 201864

3

Joined The Fuji Bank, Limited
Executive Officer and General Manager ofKobunacho Branch of Mizuho Bank, Ltd.
Managing Executive Officer of Mizuho Financial
Group, Inc.
President and Representative Director of Mizuho
Financial Strategy Co., Ltd. (retired in April
2012)
Managing Director of Mizuho Financial Group,
Inc.
Member of the Board of Directors of Mizuho(Note) 4
Financial Group, Inc. (retired in June 2012)
Deputy President and Representative Director ofMizuho Bank, Ltd. (retired in April 2013)
President and CEO and Representative Directorof Mizuho Trust & Banking Co., Ltd.
Director and Chairman of Mizuho Trust &Banking Co., Ltd.
External Audit & Supervisory Board Member ofSompo Japan Nipponkoa Insurance Inc.
(currently Sompo Japan Insurance Inc.) (retired in－－Official title or position

Name

Date of BirthBusiness Experience and Position(s) and Office(s)Number of
Office shares held
Term (Thousandsof shares)June 2022)
March 2019
April 2019
June 2020
March 2021
April 2023
April 1984
September
1991
April 2004

June 2011
Director(Note)1

Yumiko Kinoshita

July 13, 1961

February
2016
March 2018

External Director of FUJIYA CO., LTD. (topresent)
Senior Adviser of Mizuho Trust & Banking Co.,
Ltd. (retired in March 2023)
Chairman of Shouohkai Foundation (to present)
External Director of the Company (to present)
Adviser of Mizuho Financial Group, Inc. (topresent)
Joined Bank of Japan
Joined McKinsey & Company
Joined The National Museum of Emerging
Science and Innovation of Japan Science andTechnology Agency
General Manager, Corporate Planning
Department of KCJ GROUP INC.
Director of JAPAN PROFESSIONALFOOTBALL LEAGUE (retired in March 2018)
Chairperson responsible for extraordinary
diplomacy of JAPAN PROFESSIONALFOOTBALL LEAGUE (retired in March 2020)
Director of Tokyo Football Association (topresent)
External Director of the Company (to present)
Member of Administrative Council ofHitotsubashi University (to present)(Note) 4－

Joined The Yasuda Fire and Marine InsuranceCo., Ltd.
April 2009
General Manager of Marine Insurance Office ofSompo Japan Insurance Inc.
October 2011 President and Director of Sompo Japan
Nipponkoa Insurance Company of Europe
Limited (retired in March 2016)
April 2014
Executive Officer and General Manager ofEurope Division of Sompo Japan Insurance Inc.
Executive Officer and General Manager of Europe
Division of
NIPPONKOA Insurance Co., Ltd.
September
Executive Officer and General Manager ofEurope Division of Sompo Japan Nipponkoa
December 6, 1960 2014
(Note) 7
Insurance Inc. (currently Sompo Japan Insurance
Inc.)
Executive Officer and General Manager of Europe
Division of Sompo Japan Nipponkoa Holdings,
Inc. (retired in March 2016)
April 2016
Executive Vice President of Sompo Japan
Nipponkoa Insurance Inc.
April 2018
Executive Vice President and General Manager ofEnterprise Market Promotion Division of Sompo
Japan Nipponkoa Insurance Inc. (retired in March
2019)
March 2019 Audit & Supervisory Board Member of theCompany (full-time) (to present)

4

April 1988
Joined The Yasuda Trust and Banking Co., Ltd.
October 2010 General Manager of Kawagoe Branch of Mizuho
Trust & Banking Co., Ltd.
January 2013 General Manager of Real Estate Sales Department
No.3 of Mizuho Trust & Banking Co.
April 2016
Executive Officer, General Manager of Trust
Sales Department No. 8 of Mizuho Trust &(Note) 5
Banking Co., Ltd.
April 2018
Director and Senior Managing Executive Officer
of Heisei Building Co., Ltd.
April 2018
President and Representative Director of
Nihonbashi Building Service Co., Ltd. (retired in
March 2023)
April 2020
Senior Managing Executive Officer of Heisei

0July 2020
March 2021
April 2022
April 1983

Audit & Supervisory Board
Member(Full-time)

Audit & Supervisory Board
Member(Full-time)

Takashi Yoshino

Isao Jinno

March 1, 1965

65

Official title or position

Name

Date of BirthBusiness Experience and Position(s) and Office(s)March 2023
September
2007
September
2007
January 2010
Audit & Supervisory Board
Member(Note) 2

Sayaka Hieda(Note) 3

October 22, 1978

March 2019
March 2021

June 2024

April 1992
April 1995
July 2004
August 2006
September
2006
July 2008
June 2009
Audit & Supervisory Board
Member(Note) 2

Naohiro Chikada December 19, 1969

June 2016

April 2018

December
2020
June 2022
July 2022
March 2024

Total

Number of
Office shares held
Term (Thousandsof shares)

Building Co., Ltd. (retired in March 2023)
Audit & Supervisory Board Member of theCompany (full-time) (to present)
Registered as a lawyer
Joined HANZOMON SOGO LAW OFFICE(resigned in December 2009)
Joined OMOTESANDO SOGO LAW OFFICE (topresent)
External Audit & Supervisory Board Member of(Note) 7
the Company (to present)
Audit&
Supervisory
Board
Member(Independent), Institution for a Global Society
Corporation (to present)
Outside Audit & Supervisory Board Member of
SAN-AI OBBLI CO., LTD. (to be appointed inJune 2024)

0

Joined Chuo Shinko Audit Corporation
Registered as a certified public accountant
Partner at ChuoAoyama Pricewaterhouse Coopers(retired in July 2006)
Established Chikada Certified Public Accountant
Office as Head (to present)
Registered as a certified tax accountant
Representative Director of Chiyoda Accounting
Corporation (to present)
Representative Partner of Koa Audit Corporation(to present)
Outside Director ( Audit & Supervisory
Committee Member) of RIZAP GROUP, Inc.
(retired in March 2020)
Outside Director (Audit & Supervisory
Committee Member) of SKIYAKI Inc. (to retirein April 2024)
Outside Corporate Auditor of Mitsubishi
Research Institute DCS Co., Ltd. (to present)
External Corporate Auditor of FEED ONE CO.,LTD. (to present)
Outside Corporate Auditor of SKIYAKI LIVEPRODUCTION Inc. (to retire in July 2024)
External Audit & Supervisory Board Member of
the Company (to present)(Note) 6-

111(Notes) 1. Directors Shuichi Hattori, Yoshimitsu Onji, Takeo Nakano, and Yumiko Kinoshita are External Directors.
2. Audit & Supervisory Board Members Sayaka Hieda and Naohiro Chikada are External Audit & Supervisory Board
Members.
3. Sayaka Hieda’s name in the family register is Sayaka Kimura.
4. The term of office is from the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ended
December 31, 2022 to the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ending December
31, 2024.
5. The term of office is from the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ended
December 31, 2022 to the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ending December
31, 2026.

66

6. The term of office is from the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ended
December 31, 2023 to the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ending December
31, 2026.
7. The term of office is from the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ended
December 31, 2023 to the conclusion of the Ordinary General Meeting of Shareholders for the fiscal year ending December
31, 2027.
8. Pursuant to Paragraph 3 of Article 329 of the Companies Act, the Company has appointed one substitute External Audit &Supervisory Board Member in advance in preparation for a contingency in which the number of Audit & Supervisory Board
Members is not sufficient as stipulated by law. A brief biography of the substitute External Audit & Supervisory Board
Member is as follows.
Name

Date of BirthBusiness Experience and Position(s) and Office(s)February 1985

Number of shares
held(Thousands ofshares)Registered as a certified public accountant

September 1987 Joined Yamaguchi Certified Public Accountant Office
January 1996

Takao Yamaguchi

September 13, 1954

June 2013
June 2015
March 2016
March 2019

Head of Yamaguchi Certified Public Accountant Office(to present)
External Audit & Supervisory Board Member of SATOHOLDINGS CORPORATION(retired in June 2021)
Outside Corporate Auditor of KYORIN PharmaceuticalCo., Ltd. (to present)
External Audit & Supervisory Board Member of theCompany (retired in March 2024)
External Audit & Supervisory Board Member of Lion
Corporation (retireed in March 2023)

67

3

9. The Company has adopted a Managing Officer system. In addition to the above seven Managing Officers who concurrently
serve as Directors, the Company has the following 15 Managing Officers, whose responsibilities are as follows.
Senior Managing Executive Officer Hisayoshi Kato
Special Mission in charge of Policy & Environment
Managing Executive Officer

Hiroshi Takahashi

Division Director of Leisure Business Division;
Responsible for Logistics Properties Development &Management Department and Retail Properties
Development & Management Department; General
Manager of Hotel Development & Management
Department

Managing Officer

Masayuki Okubo

General Manager of Project Management Department (1)of Residential Development Division

Managing Officer

Kazuki Sugise

President and Representative Director of Tokyo
Tatemono Investment Advisors Co., Ltd.

Managing Officer
Managing Officer

Yusuke Mishima
Katsuhiko Tamai

General Manager of Accounting Department
Representative Director, President and Chief Executive

Managing Officer

Shigeru Sabayashi

Officer of Nihon Parking Corporation
General Manager of Project Management Department (2)Managing Officer

Hiroto Fukui

of Residential Development Division
Representative Director, President and Chief Executive
Officer of Tokyo Fudosan Kanri Co., Ltd.;
Representative Director, President and Chief Executive

Managing Officer

Kenji Sugaya

Officer of Tokyo Building Service Co., Ltd.
Managing Executive Officer and Director of TokyoManaging Officer

Yuichi Kawazoe

Tatemono Real Estate Sales Co., Ltd.
General Manager of Logistics Properties Development &Managing Officer

Yutaka Onuma

Management Department
General Manager of Corporate Planning Department andManaging Officer

Yuji Araki

Sustainability Management Department
General Manager of Finance Department

Managing Officer

Satoru Kondo

General Manager of Residential Management
Department

Managing Officer
Managing Officer

Takashi Endo
Keijiro Ochi

General Manager of Residential Engineering Department
General Manager of Acquisitions & Sales Department(ii) Status of External Officers
The Company has four External Directors and two External Audit & Supervisory Board Members. Relationship with theCompany, reasons for the appointment and expected roles, and other main companies and positions at which they concurrently
hold positions are as follows.
Title

Name

External Director

Shuichi Hattori

External Director

Yoshimitsu Onji

Relationship with the Company
Other than the foregoing, there are no special interest relationships
between Mr. Shuichi Hattori and the Company.
Mr. Hattori’s professional knowledge and experience as an
attorney-at-law are expected to contribute to the strengthening of
the governance system, including the strengthening of supervisionof the execution of duties by Directors from an independent
standpoint. Thus, he is appointed as an External Director.
Other than the foregoing, there are no special interest relationships
between Mr. Yoshimitsu Onji and the Company.
Also, his extensive experience and broad insight as a business
manager are expected to contribute to the strengthening of thegovernance system, including the strengthening of supervision of
the execution of duties by Directors from an independent
standpoint. Thus, he is appointed as an External Director.

68TitleExternal Director

External Director

External Audit &Supervisory Board
MemberExternal Audit &Supervisory Board
MemberName

Relationship with the Company

Although Mr. Takeo Nakano is a former employee of Mizuho
Bank, Ltd. and Mizuho Trust & Banking Co., Ltd., and theCompany has transactions with both banks, including borrowing
funds, the Company believes that there is no risk of influencing
the judgment of shareholders and investors considering the scaleof the transactions.
Furthermore, he concurrently serves as Chairman of the
Shouohkai Foundation, and although there are transactions
between the Company and the Foundation, such as theconsignment of health checkup services, and donations from theTakeo Nakano
Company to the Foundation, the Company believes that there isno risk of influencing the judgment of shareholders and investors
considering the scale of transactions and donations, etc., andtherefore the Company deems there are no concerns that any
conflict of interest may arise.
Also, his extensive experience and broad insight as a business
manager are expected to contribute to the strengthening of thegovernance system, including the strengthening of supervision of
the execution of duties by Directors from an independent
standpoint. Thus, he is appointed as an External Director.
Other than the foregoing, there are no special interest relationships
between Ms. Yumiko Kinoshita and the Company.
It is expected that Ms. Kinoshita will contribute to the
Yumikostrengthening of the governance system by enhancing supervision
Kinoshitaof the Directors’ execution of their duties from an independent
standpoint, based on her global perspective cultivated throughoverseas experience and her diverse business experience at publicinterest corporations.
Other than the foregoing, there are no special interest relationships
between Mr. Naohiro Chikada and the Company.
The Company expects Mr. Chikada to apply his professional
Naohiro Chikada knowledge and experience as a certified public accountant and tax
accountant to the Company’s auditing operations from an
independent standpoint and has therefore appointed him as anExternal Audit & Supervisory Board Member.
Other than the foregoing, there are no special interest relationships
between Ms. Sayaka Hieda and the Company.
The Company has appointed Ms. Hieda as an External Audit &Sayaka Hieda
Supervisory Board Member as she is expected to apply her
expertise and experience as an attorney-at-law to the Company’s
auditing operations from an independent standpoint.

External Directors and External Audit & Supervisory Board Members are appointed based on a comprehensive evaluation of
their personalities, abilities, insight, and experience, as well as their ability to provide appropriate opinions on the Company’s
management from an independent and objective perspective in order to strengthen the supervisory function of the Board of
Directors.
The shareholdings of the Company’s External Directors and External Audit & Supervisory Board Members are as describedunder “(i) List of Directors and Audit & Supervisory Board Members” presented above.
Furthermore, in appointing External Directors, the Company has stipulated criteria for determining independence to ensurethat candidates are deemed independent in terms of substance. In addition to the independence criteria stipulated by the Tokyo
Stock Exchange, the Company considers an External Director to be independent if none of the following apply.
・Business partners or their business executors accounting for 2% or more of the Company’s consolidated sales in the mostrecent fiscal year
・Shareholders holding more than 10% of the total voting rights of the Company or their business executors
・Representative partners, partners, or employees of the audit firm that is our Accounting Auditor
・Consultants, accounting experts, or legal experts whose remuneration from the Company in the most recent fiscal year
(excluding remuneration for Directors and Audit & Supervisory Board Members) exceeds ¥10 million

69

(ⅲ) Supervision or Audit and Internal Audit by External Directors or External Audit & Supervisory Board Members, Audit byAudit & Supervisory Board Members and Mutual Collaboration with Accounting Auditor, as well as Relationship with
Internal Control Division
External Directors receive regular reports from the executive Directors on the status of business activities and internal controlsof the Company and its group companies and render advice, etc. to the management from an independent and objective
standpoint.
The Audit & Supervisory Board Members, including External Audit & Supervisory Board Members, receive an annual audit
plan from the Accounting Auditors to monitor and verify whether the Accounting Auditors are conducting appropriate audits
and thereafter implement coordinated actions as necessary, such as receiving regular reports and information on laws,
regulations, and accounting standards, as well as maintaining close cooperation with the internal audit division to conduct
systematic and efficient audits. Besides receiving regular reports from the internal audit division at the Audit & Supervisory
Board meetings, the full-time Audit & Supervisory Board Members separately receive reports from the Internal Audit
Department on a timely basis.
While ensuring an independent and objective standpoint, the External Directors and Audit & Supervisory Board Members
work together through regular meetings and other means to enable the External Directors to gather information efficiently.

70

(3) Status of Audits(ⅰ) Status of Audit by Audit & Supervisory Board Members
a. Audit Organization, Personnel and Procedures
Consisting of two full-time Audit & Supervisory Board Members and two External Audit & Supervisory Board Members,
the Audit & Supervisory Board of the Company formulates audit policies, plans, auditing methods, and allocation of audit
duties, receives reports on important audit-related matters, and discusses and makes resolutions thereof. Furthermore,
External Audit & Supervisory Board Member Takao Yamaguchi is a certified public accountant with considerable financeand accounting knowledge.
b. Status of Activities by Audit & Supervisory Board Members and the Audit & Supervisory Board
The Audit & Supervisory Board generally meets once a month and held 16 meetings during the current fiscal year. The
attendance record of each Audit & Supervisory Board Member is as follows.
Title

Name

Meeting attendance

Full-time Audit &Takashi Yoshino
16/16 times
Supervisory Board Member
Full-time Audit &Isao Jinno
11/11 times
Supervisory Board Member
Full-time Audit &Koji Kawakubo
5/5 times
Supervisory Board Member
External Audit &Takao Yamaguchi
16/16 times
Supervisory Board Member
External Audit &Sayaka Hieda
16/16 times
Supervisory Board Member(Note) Koji Kawakubo retired from his position at the 205th Ordinary General Meeting of Shareholders held on March
29, 2023, and his attendance at the Board of Directors meetings held on or before that date is shown.
Isao Jinno was elected at the 205th Ordinary General Meeting of Shareholders held on March 29, 2023, and his
attendance at the Board of Directors meetings held after that date is shown.
The specific considerations by the Audit & Supervisory Board Members are as follows.
・Matters related to the operation of the Audit & Supervisory Board
・Matters related to the General Meeting of Shareholders
・Matters related to the status of the development and operation of management and governance systems
・Matters related to the verification of the establishment and effectiveness of the internal control system
・Matters related to the verification and evaluation of the appropriateness of the accounting audit by the Accounting
Auditor・Matters concerning the status of management related to important businesses and individual cases, etc.
・Matters Related to determination of Key Audit Matters (KAMs)
・Matters related to the status of the establishment of a foundation for the operation of a new group internal audit
system
The main activities of the Full-time Audit & Supervisory Board Members are as follows:
Attendance at Board of Directors meetings and statement of opinions
Attendance and statement of opinions at important meetings such as the Group Management
Meeting
Regular meetings with representative Director and External Directors and individual meetings with
Directors
Business Audits

Conducting on-site inspections of each business division and group company and hearing reports
Verification of the status of maintenance of internal regulations, etc.
Perusal of documents related to important resolutions
Hearing of reports on audit implementation plans and audit results from the Internal Audit
Department and exchanging opinions

Accounting
Audit

Consultation with the Accounting Auditor regarding the explanation of the audit plan, quarterly
review report, report on audit results, and determination of key audit matters (KAMs) from the
Accounting Auditor
Investigation and audit of the status of operations related to quarterly and full-year financial results

All Full-time Audit & Supervisory Board Members report to one another in a timely and appropriate manner and share71

information regarding their audit activities. Furthermore, the Audit & Supervisory Board makes appropriate reports to theExternal Audit & Supervisory Board Members to share information.
(ii) Status of Internal Audits
The Company has established an Internal Audit Department (5 members) that reports directly to the President and Chief
Executive Officer. Based on the annually prepared audit plan, the Internal Audit Department periodically conducts businessaudits, makes recommendations for improvement, and monitors the implementation of remedial measures to ensure proper
business operations.
In order to effectively conduct these internal audit operations, the Internal Audit Department actively exchanges opinions andinformation at regular meetings with Audit & Supervisory Board Members and the Accounting Auditor and reports the resultsof internal audits to the Audit & Supervisory Board. Furthermore, the results of internal audits are reported to theRepresentative Director, President and Chief Executive Officer, and then to the Board of Directors through the Representative
Director, President and Chief Executive Officer.
(iii) Status of Accounting Audit
a. Name of Audit Firm
Ernst & Young ShinNihon LLC
b. Consecutive Number of Years during which Audit Was Performed
19 yearsc. Certified Public Accountants who engaged in the audit
Designated Engagement Partner Yuji Mukaide
Designated Engagement Partner Koji Ojimad. Composition of persons supporting audit operations
10 certified public accountants and 20 other persons providing support
e. Policies and Reasons for Appointing Audit Firm
The Company selects auditing certified public accountants, etc. after comprehensively confirming and reviewing the quality
control system, independence, audit implementation system, audit fees, etc. of the audit firm, based on the “Code of Practicefor Audit & Supervisory Board Members, etc. regarding the Evaluation of Accounting Auditors and the Establishment of
Selection Criteria for Accounting Auditors” stipulated by the Japan Audit & Supervisory Board Members Association.
Upon review and confirmation of the above, we have determined that it is appropriate to reappoint Ernst & Young ShinNihon
LLC as the auditing certified public accountant for the current consolidated fiscal year.
Should the Audit & Supervisory Board deem it necessary, such as when there is a hindrance to the performance of duties by
the auditing certified public accountant, it will decide on a proposal for the dismissal or non-reappointment of the Certified
Public Accountant, and the Company will submit a proposal to the General Meeting of Shareholders in accordance with saiddecision.
Should the Audit & Supervisory Board find that the auditing certified public accountant falls under Paragraph 1, Article 340of the Companies Act, the Audit & Supervisory Board shall dismiss the auditing certified public accountant based on theunanimous consent of the Audit & Supervisory Board Members. Upon such a dismissal, the Audit & Supervisory Board
Member selected by the Audit & Supervisory Board shall report the fact that the auditing certified public accountant has been
dismissed and the reason for dismissal at the first General Meeting of Shareholders convened after said dismissal.
f. Evaluation of Audit Firm by Audit & Supervisory Board Members and Audit & Supervisory Board
Upon comprehensively reviewing and considering Ernst & Young ShinNihon LLC’s quality control system, audit
implementation system, audit fees, communication with Audit & Supervisory Board Members and other relevant personnel,
and relationship with management, the Audit & Supervisory Board Members and the Audit & Supervisory Board haveconcluded that the auditing activities of Ernst & Young ShinNihon LLC are appropriate.

72

(iv) Details of Audit Fees, etc.
a. Fees to auditing certified public accountants
FY2022

FY2023Category

Fees forAudit Services(Millions of yen)

Fees forNon-audit Services(Millions of yen)

Fees forAudit Services(Millions of yen)

Fees forNon-audit Services(Millions of yen)

The Company

83

－

84

2

Subsidiaries

49

3

52

－

Total

132

3

136

2

(Notes) 1. Non-audit services rendered for the Company include preparation of a comfort letter in connection with theissuance of corporate bonds.
Non-audit services for subsidiaries include accounting advice and guidance.
2. In accordance with the revision of the Code of Ethics of the Japanese Institute of Certified Public Accountants,
the scope of aggregation of remuneration, etc., has been changed from the current consolidated fiscal year to
be consistent with the Code of Ethics.
b. Remuneration to the same network (Ernst & Young) as the auditing certified public accountants (excluding “a. Fees toauditing certified public accountants”)
FY2022

FY2023Category

Fees forAudit Services(Millions of yen)

Fees forNon-audit Services(Millions of yen)

Fees forAudit Services(Millions of yen)

Fees forNon-audit Services(Millions of yen)

The Company

－

23

－

3

Subsidiaries

2

0

4

0

Total

2

23

4

3

(Notes) 1. Non-audit services rendered for the Company include advisory services related to TCFD (Task Force on
Climate-related Financial Disclosure) in the previous consolidated fiscal year, and services related toaccounting and taxation in the current consolidated fiscal year. Non-audit services provided to subsidiaries
consist of support services related to accounting and taxation matters.
2. In accordance with the revision of the Code of Ethics of the Japanese Institute of Certified Public
Accountants, the scope of aggregation of remuneration, etc., has been changed from the current consolidated
fiscal year to be consistent with the Code of Ethics.
c. Details of other material audit fees
FY2022
Not applicable.
FY2023
Not applicable.
d. Policy for Determining Audit Fees
Audit fees for the auditing certified public accountant are appropriately determined with the consent of the Audit &Supervisory Board, comprehensively taking into consideration such factors as the size and characteristics of the Company
and the number of days spent on the audit.
e. Reason by Audit & Supervisory Board Members for giving consent to the amount of fees payable to the Accounting Auditor
Upon making the necessary verification of the appropriateness of the content of the Accounting Auditor’s audit, theperformance of its duties, and the basis for the calculation of the remuneration estimate, the Audit & Supervisory Board
decided to consent to the remuneration, etc. of the Accounting Auditor in accordance with the Companies Act.

73

(4) Remunerations for Directors(ⅰ) Details and Policies of Calculation Methods for Amount of Remuneration, etc. Paid to Officers
a. Policy, etc. on Determination of Details of Remuneration, etc. for Officers
At the Board of Directors meeting held on March 10, 2021, the Company adopted a policy for determining the details ofcompensation for individual Directors (hereinafter referred to as the “the decision-making policy”). Furthermore, theremuneration of Audit & Supervisory Board Members is determined through discussions among the Audit & Supervisory
Board Members.
Under the corporate philosophy of “Trust beyond the era,” the Company aims to achieve sustainable growth and increase
corporate value not only in the short term but also over the medium to long term; thus, it has established a remuneration
system in which a certain percentage of compensation is linked to business performance and stock price.
Compensation for Directors (excluding External Directors) consists of “fixed compensation,” “performance-based
compensation,” and “share awards,” the payment ratio of which will be set appropriately in accordance with the policy
described below. Only “fixed compensation” is paid to External Directors and Audit & Supervisory Board Members, taking
into consideration the nature of their duties.
The Board of Directors determines individual Director compensation after consultation with the Nomination andRemuneration Advisory Committee. The determination of details of individual Directors’ remuneration, as described later in“c. Matters Concerning Delegation for Determination of Details of Individual Directors’ Remuneration, etc.” is delegated bya resolution of the Board of Directors.
Policy on Determining the Percentage of Compensation Paid to Directors (excluding External Directors) by Type ofRemuneration, etc.
Item

Fixed Remuneration

Performance-BasedRemuneration

Share awards

Placement

Basic Remuneration

Short-term Incentives

Medium- to Long-Term
Incentives

Variability－

Linked to single fiscal

Linked to stock priceyear performance
Percentage of total
remuneration (approx.)
Payment timing of
remuneration, etc.

50 - 60%

30 - 40%

5 - 10%MonthlyMonthly

In principle, uponretirement from office

The proposal of individual remuneration, etc. of Directors for the current fiscal year is prepared in accordance with thedecision-making policy and the resolution of the General Meeting of Shareholders as stipulated below under “b. Matters
Concerning the Resolution of the General Meeting of Shareholders on Remuneration, etc. of Directors and Audit &Supervisory Board Members” and determined through consultation with the Nomination and Remuneration Advisory
Committee. Accordingly, the Board of Directors believes that the content of individual remuneration, etc. of Directors forthe current fiscal year is in line with the decision policy.
b. Matters Concerning the Resolution of the General Meeting of Shareholders on Remuneration, etc. of Directors and Audit& Supervisory Board Members<Fixed Remuneration>
At the 190th Ordinary General Meeting of Shareholders held on March 28, 2008, it was resolved that the remuneration
for Directors shall be limited to ¥35 million per month, and the remuneration for Audit & Supervisory Board Members
shall be limited to ¥8 million per month. As of the closing of said General Meeting of Shareholders, the number of
Directors was 18, and that of the Audit & Supervisory Board Members was 4.
<Performance-Based Remuneration>
At the 195th Ordinary General Meeting of Shareholders held on March 28, 2013, a resolution was passed to introduce
performance-based remuneration for Directors (excluding External Directors) to motivate them to improve theirperformance in each fiscal year and to pay them within 1% of consolidated ordinary income and 2% of consolidated
profit (profit attributable to owners of parent) for the previous fiscal year. These indicators were selected based on ourbelief that they adequately represent the Company’s performance in view of the nature and content of the Company’sbusiness. The number of Directors (excluding External Directors) as of the end of this General Meeting of74

Shareholders was 7.
<Share awards>
Upon the 200th Ordinary General Meeting of Shareholders held on March 28, 2018, a resolution was passed to
introduce the “Board Benefit Trust (BBT),” a share award plan for Directors (excluding External Directors), with theaim of raising awareness of the need to contribute to increasing corporate value over the medium to long term. The
number of Directors (excluding External Directors) as of the end of this General Meeting of Shareholders was 8.
Outline of the share award plan will be as follows.
・Under the share award plan, the Company’s shares are acquired through a trust funded by the Company, and theCompany’s shares and cash equivalent to the market value of the Company’s shares are paid out through the trust inaccordance with the “Regulations of Directors' Equity Benefit” stipulated by the Company. The enactment of theregulation was adopted by the Board of Directors after consulting with the Nomination and Remuneration Advisory
Committee.
・Each Director (excluding External Directors) is granted a certain number of points per fiscal year, limited to 40,000
shares (40,000 points) per fiscal year, in consideration of his/her position in the Company. Upon retirement, theDirectors will receive Company shares in proportion to the number of points accumulated and a cash payment
equivalent to the market value of the Company’s shares.
c. Matters Concerning Delegation for Determination of Details of Individual Directors’ Remuneration, etc.
Pursuant to the delegation by resolution of the Board of Directors, the Representative Director, President and Chief Executive
Officer of the Company shall, in accordance with the decision-making policy and the resolution of the General Meeting of
Shareholders as stipulated under the above-mentioned “b. Matters Concerning the Resolution of the General Meeting of
Shareholders on Remuneration, etc. of Directors and Audit & Supervisory Board Members,” prepare a proposal for individual
fixed remuneration and performance-based remuneration for Directors according to their position and responsibilities eachfiscal year and submit it to the Nomination and Remuneration Advisory Committee (of the total seven members, four External
Directors constitute the majority together with three Directors (excluding External Directors)) for consultation to determine
the specific content of individual remuneration amounts for each Director. This responsibility has been delegated to theRepresentative director, President & Chief Executive Officer as he is best suited to make an evaluation comprehensively
taking into consideration the Company’s performance and the duties and responsibilities of the Directors.
Hitoshi Nomura, Representative Director, President and Chief Executive Officer, undertook such delegation in the fiscal year
under review, and the specific details of the amount of remuneration for each individual Director for the fiscal year underreview were determined in accordance with the process described above.
d. Targets and Results of Performance-Based Remuneration-Related Indicators for the Current Fiscal Year
Indicators for performance-based remuneration in the current fiscal year are consolidated ordinary income and consolidated
profit (profit attributable to owners of parent) for the previous fiscal year. The forecast figures of consolidated ordinary profit
and consolidated profit (profit attributable to owners of parent) are ¥61,500 million and ¥41,500 million, respectively (figuresannounced as the forecast for the fiscal year ended December 31, 2022, in the financial report dated August 10, 2022). Against
this forecast, the actual results were a consolidated ordinary profit of ¥63,531million and a consolidated profit (net income
attributable to owners of parent) of ¥43,062 million.

75

(ii) Total amount of remuneration, total amount of remuneration by type, and number of recipient directors (and other officers)
by category of Officer
Total amount of remuneration by type (Millions of yen)
Total amount of
Category of Officers

remuneration(Millions of yen)

Fixed
Remuneration

PerformanceBasedRemuneration

Share awards

Number ofrecipientdirectors (andother officers)(persons)

Directors(excl. External Directors)

604

322

240

42

10

Audit & Supervisory
Board Members(excl. External Audit &Supervisory Board
Members)

55

55

－

－

3

External Officers

58

58

－

－

6

(Notes) 1. Share awards fall under the category of “non-monetary compensation.”
2. The total amount of share awards is the amount of provision for share-based remuneration for directors (andother officers) based on the Board Benefit Trust (BBT) for the fiscal year under review. The provision for sharebased remuneration for directors (and other officers) is based on the book value of the Company’s shares acquired
through the trust using funds contributed by the Company as the source of funds for the calculation.

(iii) Total amount of remunration, etc. for those whose total compensation, etc. amounts to ¥100 million or more
Total amount of remuneration by type (Millions of yen)
Name

Category of Officers

Performance-Based
Fixed Remuneration
Remuneration

Share awards

Total amount of
remuneration(Millions of yen)

Representative
Director andMakio Tanehashi
61
42
8
113
Chairman of the
Board
Representative
Director
61
42
8
112
Hitoshi Nomura
President & Chief
Executive Officer(Note) 1. Share awards fall under the category of “non-monetary compensation.”
2. The total amount of share awards is the amount of provision for share-based remuneration for directors (and otherofficers) based on the Board Benefit Trust (BBT) for the fiscal year under review. The provision for share-based
remuneration for directors (and other officers) is based on the book value of the Company’s shares acquired
through the trust using funds contributed by the Company as the source of funds for the calculation.

76

(5) Information on Shareholdings(i) Criteria and Approach for Classification of Investment Stocks
By maintaining and strengthening business relationships, the Company retains shares of other companies that it deems willcontribute to the medium- to long-term enhancement of the Group’s corporate value as shares other than for pure investment
purposes (strategic shareholdings).
(ii) Investment shares held for purposes other than pure investment
a. Method of verifying holding policies and rationality of holdings, and details of verification by the Board of Directors, etc.
regarding the appropriateness of holding individual issues
By maintaining and strengthening business relationships, the Company retains shares of other companies that it deems willcontribute to the medium- to long-term enhancement of the Group’s corporate value as shares other than for pure investment
purposes (strategic shareholdings).
The Company examines the appropriateness of individual strategic shareholdings from the perspective of whether they
contribute to the maintenance and improvement of the Group’s corporate value, including the results and prospects of realestate transactions, joint ventures, construction and equipment transactions, and financial transactions, as well as the resultsof dividend payments. Upon review, the Company will report to the Board of Directors on the details and actual results ofthe disposal, etc. and will reduce the number of shares that it no longer recognizes the significance of continuing to hold,taking into consideration the impact on the stock market, etc.
At a meeting of the Board of Directors held on February 13, 2024, the Company reported the results of transactions andholdings of each individual share and verified the appropriateness of the holdings.
b. Number of Stock and Carrying Amount Recorded in the Balance Sheet
Number of
Stocks(Stocks)

Carrying Amount Recorded in
the Balance Sheet(Millions of yen)

25

3,369

49

100,935

Equity Securities Not
ListedShares Other than Equity
Securities Not Listed(Name of stock of shares that increased during the current fiscal year)
Number of
Stocks(Stocks)

Total Acquisition Amount for
Increased Shares(Millions of yen)

1

112

1

300

Reason for Increase in the Number of
SharesTo contribute to the medium- to long-

Equity Securities Not
Listedterm enhancement of the Group’s
corporate value.
To contribute to the medium- to long-

Shares Other than Equity
Securities Not Listed(Name of stock of shares that decreased during the current fiscal year)
Number of
Stocks(Stocks)

Total disposal amount related tothe decrease in the number ofshares(Millions of yen)

Equity Securities Not
Listed－－Shares Other than Equity
Securities Not Listed

－

－

77

term enhancement of the Group’s
corporate value.

c. Information on specified investment stocks and stocks deemed to be held, including the number of shares by stock, and theamount recorded in the Balance Sheet
Specified investment stocks

Issuer NameFY2023

FY2022

Number of shares(shares)Number of shares(shares)

Carrying amount(Millions of yen)

Carrying amount(Millions of yen)

40,749,033

40,749,033

Hulic Co., Ltd.
60,16542,378

Purpose of shareholding, overview of business
Whetheralliance, quantitative effects of shareholding and Issuer Holds
reason for increase in number of sharesCompany(Note) 1
SharesTo maintain and strengthen real estatetransactions and joint ventures, etc. in theCommercial Properties business, thereby
contributing to the enhancement of corporate

Yesvalue.
As the company is a tenant in an office801,905

801,905

SOMPO Holdings,
Inc.

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to theenhancement of corporate value.
Financial transactions are also conducted to

5,529

4,699

Yes
(Note) 2

contribute to stable financing.
In addition, the Company has entered into abusiness alliance for the development andoperation of facilities for the elderly.
As the company is a tenant in an office951,980

951,980

TAISEICORPORATION

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, joint ventures, andconstruction and equipment transactions in the

4,590

4,045

Yes

Commercial Properties business, thereby
contributing to the enhancement of corporate
value.
As the company is a tenant in an office

170,000

170,000

Fuyo General Lease
Co., Ltd.

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to the

2,081

1,465

Yes

enhancement of corporate value.
Financial transactions are also conducted tocontribute to stable financing.

INFRONEER
Holdings Inc.

SEIBU HOLDINGS
INC.

Yasuda Logistics

1,423,000

1,423,000

1,997

1,424

994,300

994,300

To maintain and strengthen construction andequipment transactions, etc. in the Residential
business, thereby contributing to theenhancement of corporate value.
To maintain and strengthen real estatetransactions, etc. in the Asset Service business,thereby contributing to the enhancement ofcorporate value.

1,945

1,433

1,603,000

1,603,000

To contribute to the enhancement of corporate
value by maintaining and strengthening good

1,482

relationships pertaining to the business of theCompany’s group as a whole.

Corporation
1,880

78

Yes
(Note) 2

Yes(Note) 2

Yes

Issuer NameFY2023

FY2022

Number of shares(shares)Number of shares(shares)

Carrying amount(Millions of yen)

Carrying amount(Millions of yen)

Purpose of shareholding, overview of business
Whetheralliance, quantitative effects of shareholding and Issuer Holds
reason for increase in number of sharesCompany(Note) 1
SharesAs the company is a tenant in an office684,112684,112

estate transactions and joint ventures, etc. in
the Commercial Properties business, thereby

Mizuho Financial
Group, Inc.

Katakura Industries
Co., Ltd.

1,650

1,269

980,000

980,000

1,605

1,701

933,687

933,687

1,591

1,139

TPR Co., Ltd.

442,200

442,200

Tokio Marine
Holdings, Inc.

The Japan Wool
Textile Co., Ltd.

TEIKOKU SEN-I
Co., Ltd.

Okamoto Industries,Inc.

building owned by the Group, this transaction
is intended to maintain and strengthen realcontributing to the enhancement of corporate
value.
Financial transactions are also conducted tocontribute to stable financing.
To maintain and strengthen real estatetransactions and joint ventures, etc. in theCommercial Properties business, thereby
contributing to the enhancement of corporate
To maintain and strengthen real estatetransactions, etc. in the Commercial Properties
business, thereby contributing to theenhancement of corporate value.

1,112,500

1,112,500

1,492

1,083

698,733

698,733

1,427

1,055

260,200

260,200

To contribute to the enhancement of corporate
value by maintaining and strengthening good964

relationships pertaining to the business of theCompany’s group as a whole.

To maintain and strengthen real estatetransactions, etc. in the Asset Service business,thereby contributing to the enhancement of

HOLDINGS INC.
1,239

1,045

To maintain and strengthen real estatetransactions, etc. in the Commercial Properties
business, thereby contributing to theYesenhancement of corporate value.

Yes

As the company is a tenant in an officebuilding owned by the Group, this transaction

the Commercial Properties business, thereby
contributing to the enhancement of corporate
value.

79

Yes

corporate value.

is intended to maintain and strengthen realestate transactions and joint ventures, etc. in

TAKARA

Yes(Note) 2

Financial transactions are also conducted tocontribute to stable financing.

1,250

1,000,000

Yes

To maintain and strengthen real estatetransactions, etc. in the Commercial Properties

1,560

1,000,000

Yesvalue.

business, thereby contributing to theenhancement of corporate value.

1,294

Yes
(Note) 2

Yes

Issuer NameFY2023

FY2022

Number of shares(shares)Number of shares(shares)

Carrying amount(Millions of yen)

Carrying amount(Millions of yen)

567,000

567,000

Mitsuuroko Group
Holdings Co., Ltd.
899

645

200,700

200,700

819

669

111,980

111,980

Taikisha Ltd.

Sapporo Holdings
LimitedHEIWA REALESTATE CO., LTD.

TOBU RAILWAY
CO., LTD.

YAMATOHOLDINGS CO.,LTD.

transactions, etc. in the Asset Service business,thereby contributing to the enhancement of
To maintain and strengthen real estatetransactions, etc. in the Commercial Properties
business, thereby contributing to theenhancement of corporate value.

182,400

To contribute to the enhancement of corporate
value by maintaining and strengthening good

687

668

relationships pertaining to the business of theCompany’s group as a whole.

180,098

180,098

682

554

260,000

260,000

677

542

690,300

690,300

490

100,000

100,000

Nippi, Incorporated

transactions and joint ventures, etc. in the
Residential business, thereby contributing totransactions, etc. in the Commercial Properties
business, thereby contributing to the
To maintain and strengthen real estatetransactions and construction and equipment
transactions in the Commercial Properties
business, thereby contributing to theYesenhancement of corporate value.
To contribute to the enhancement of corporate
value by maintaining and strengthening good
relationships pertaining to the business of the
To contribute to the enhancement of corporate
value by maintaining and strengthening good

505

381

relationships pertaining to the business of theCompany’s group as a whole.

Yes

Company’s group as a whole.

470,076As the company is a tenant in an officebuilding owned by the Group, this transaction334

equipment transactions in the Commercial
Properties business, thereby contributing to theis intended to maintain and strengthen realestate transactions, and construction andenhancement of corporate value.

80

Yes(Note) 2

enhancement of corporate value.

72,187428

Yes

To maintain and strengthen real estate

72,187

Co., Ltd.

Yes

the enhancement of corporate value.

344

Oki Electric IndustryYes

To maintain and strengthen real estate596

470,076Yes

corporate value.

182,400

643

Yes

To maintain and strengthen real estate

367

CORPORATIONCORPORATIONAs the company is a tenant in an officebuilding owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to theenhancement of corporate value.

696

TODA

NOF

Purpose of shareholding, overview of business
Whetheralliance, quantitative effects of shareholding and Issuer Holds
reason for increase in number of sharesCompany(Note) 1
SharesYes

Yes

Issuer NameASANUMACORPORATION

FY2023

FY2022

Number of shares(shares)Number of shares(shares)

Carrying amount(Millions of yen)

Carrying amount(Millions of yen)

100,000

100,000

386

302

80,00080,000373

266

375,000

375,000

Azbil Corporation

NIPPON SIGNAL
CO., LTD.

363

390

Purpose of shareholding, overview of business
Whetheralliance, quantitative effects of shareholding and Issuer Holds
reason for increase in number of sharesCompany(Note) 1
SharesTo maintain and strengthen construction andequipment transactions, etc. in the Residential
business, thereby contributing to theenhancement of corporate value.

Yes

To maintain and strengthen construction andequipment transactions, etc. in the Commercial
Properties business, thereby contributing to theYesenhancement of corporate value.
To maintain and strengthen construction andequipment transactions, etc. in the Asset
Service business, thereby contributing to theYesenhancement of corporate value.
As the company is a tenant in a logistics
property owned by the Group, this transaction

70,600－Tonami Holdings.

is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to theenhancement of corporate value.

Co., Ltd.
318

－

Yes

Shares of the company were acquired in order
to contribute to the enhancement of its
corporate value over the medium to long term.

MATSUICONSTRUCTION
CO., LTD.

Nippon Sanso
Holdings Corporation

Nishimatsu
Construction Co., Ltd.

363,000

363,000

304

203

79,28479,284299

151

74,20074,200291

290

To maintain and strengthen real estatetransactions, etc. in the Commercial Properties
business, thereby contributing to theYesenhancement of corporate value.
To maintain and strengthen real estatetransactions, etc. in the Commercial Properties
business, thereby contributing to theenhancement of corporate value.
To maintain and strengthen real estatetransactions, etc. in the Asset Service business,thereby contributing to the enhancement ofcorporate value.

No

No

As the company is a tenant in an office
TAKARA
STANDARD CO.,LTD.

166,000

270

166,000229

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to theYesenhancement of corporate value.
As the company is a tenant in an office326,857

326,857

NSK Ltd.

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions and joint ventures, etc. in
the Commercial Properties business, thereby

249

229

81

contributing to the enhancement of corporate
value.

Yes

Issuer NameTOACORPORATION

FY2023

FY2022

Number of shares(shares)Number of shares(shares)

Carrying amount(Millions of yen)

Carrying amount(Millions of yen)

63,60063,600To maintain and strengthen construction andequipment transactions, etc. in the Commercial

226

150

Properties business, thereby contributing to theenhancement of corporate value.

305,100

305,100

223

212

Okabe Co., Ltd.

Purpose of shareholding, overview of business
Whetheralliance, quantitative effects of shareholding and Issuer Holds
reason for increase in number of sharesCompany(Note) 1
SharesYes

To maintain and strengthen real estatetransactions, etc. in the Asset Service business,thereby contribute to the enhancement ofYes

corporate value.
As the company is a tenant in an office

25,87225,872

Sumitomo Mitsui
Financial Group, Inc.

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to the

177

137

Yes
(Note) 2

enhancement of corporate value.
Financial transactions are also conducted tocontribute to stable financing.

64,96864,968The Ogaki Kyoritsu
Bank, Ltd.
122

122

84,70042,350As the company is a tenant in an officebuilding owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to theenhancement of corporate value.
Financial transactions are also conducted tocontribute to stable financing.
To maintain and strengthen construction andequipment transactions, etc. in the Commercial
Properties business, thereby contributing to theenhancement of corporate value.

Dai-Dan Co., Ltd.
120

92

117,055

117,055

Yes

Yes

The increase in the number of shares is due to a
stock split.
To maintain and strengthen real estate

Daiwa Securities
Group Inc.
111

68

transactions, etc. in the Asset Service business,thereby contribute to the enhancement ofcorporate value.
Financial transactions are also conducted toYescontribute to stable financing.
To maintain and strengthen real estate
INTERLIFE
HOLDINGS CO.,LTD.

400,000

400,000

85

64

100,000

100,000transactions, etc. in the Asset Service business,thereby contributing to the enhancement ofYes

corporate value.
To maintain and strengthen joint ventures, etc.

Global Kids Company
Corp.
64

57

82

in the Leisure Care business, thereby
contributing to the enhancement of corporate
value.
In addition, the Company has entered into abusiness alliance for the development andoperation of childcare facilities.

NoIssuer NameFY2023

FY2022

Number of shares(shares)Number of shares(shares)

Carrying amount(Millions of yen)

Carrying amount(Millions of yen)

Purpose of shareholding, overview of business
Whetheralliance, quantitative effects of shareholding and Issuer Holds
reason for increase in number of sharesCompany(Note) 1
SharesTo maintain and strengthen real estate

171,000

171,000

Spacemarket, Inc.

transactions, etc. in the Commercial Properties
business, thereby contributing to theenhancement of corporate value.
In addition, the Company has entered into a54

49

42,86642,866

To contribute to the enhancement of corporate
value by maintaining and strengthening good

52

51

relationships pertaining to the business of theCompany’s group as a whole.

29,68029,680Joban Kosan Co., Ltd.

No

business alliance regarding the space-sharing
business, etc.

Yes

As the company is a tenant in an office

LIXIL Corporation
52

59

building owned by the Group, this transaction
is intended to maintain and strengthen realestate transactions, etc. in the Commercial
Properties business, thereby contributing to theYesenhancement of corporate value.
The Shikoku Bank,
Ltd.

47,144

47,14445

46

The Chiba Kogyo
Bank, Ltd.

53,24053,240

42

24

6,292

6,292

5

4

2,823

2,823

TOH-TEN-KOH
Corporation

Nippon Paper
Industries Co., Ltd.

3

2

Financial transactions are intended tocontribute to stable financing.

Yes

Financial transactions are intended tocontribute to stable financing.

Yes

To maintain and strengthen real estatetransactions, etc. in the Residential business,thereby contributing to the enhancement ofNo

corporate value.
To maintain and strengthen real estatetransactions, etc. in the Asset Service business,thereby contributing to the enhancement ofcorporate value.

Yes(Notes) 1. Quantitative holding effects are not stated from the viewpoint of information management regarding transactions withcounterparties, etc.
The method of verifying the rationality of holdings is described in “(ii) Investment shares held for purposes other than pureinvestment a. Method of verifying holding policies and rationality of holdings, and details of verification by the Board of
Directors, etc. regarding the appropriateness of holding individual issues.”
2. The company in which we hold the stocks does not hold any shares of the Company, while its subsidiary does hold sharesof the Company.
3. “－” indicates that the Company does not hold the stock.

83

(iii) Equity securities held for pure investment
FY2023Category

Equity Securities Not
ListedShares Other than Equity
Securities Not Listed

Number of Stocks(Stocks)

FY2022

Total Amount Recordedin the Balance Sheet(Millions of yen)

Number of Stocks(Stocks)

Equity Securities Not
ListedShares Other than Equity
Securities Not Listed

in the Balance Sheet(Millions of yen)

－

－

－

－

－

－

－

－

FY2023Category

Total Amount Recorded

Total Dividend Income Total gain (loss) on sales(Millions of yen)
(Millions of yen)

Total loss (gain) on
valuation(Millions of yen)

－

－

－

－

－

－

(Note) “－” indicates that we do not hold any shares of such stock.

84

V. Financial Information
1. Method of Preparation of Consolidated Financial Statements and Non-Consolidated Financial Statements(1) The Group’s consolidated financial statements are prepared based on the Regulation on Terminology, Forms, and Preparation
Methods of Consolidated Financial Statements (Law number: Ministry of Finance Order No. 28 of 1976).
(2) The Company’s non-consolidated financial statements are prepared based on the Regulation on Terminology, Forms, andPreparation Methods of Financial Statements (Ministry of Finance Order No. 59 of 1963, below, the “Regulation on
Terminology, Forms, and Preparation Methods of Financial Statements”).
The Company is a special company submitting financial statements and preparing its financial statements based on theprovisions of Article 127 of the Regulation on Financial Statements, etc.
2. Audit Attestation
Pursuant to Paragraph 1, Article 193-2 of the Financial Instruments and Exchange Act, the consolidated financial statements forthe consolidated fiscal year (from January 1, 2023 to December 31, 2023) and the non-consolidated financial statements for the
fiscal year (from January 1, 2023 to December 31, 2023) were audited by Ernst & Young ShinNihon LLC.
3. Special efforts for ensuring the appropriateness of consolidated financial statements
The Company has taken a special approach to ensure the propriety of consolidated financial statements, etc. Specifically, inorder to develop a system to enable the Company to appropriately understand the details of accounting standards and precisely
cope with changes, etc. in accounting standards, etc., the Company has joined the Financial Accounting Standards Foundationand endeavors to collect information actively. Further, the Company participates in training sessions administered by audit
firms and other organizations.

85

1. Consolidated Financial Statements(1) Consolidated Financial Statements(i) Consolidated Balance Sheet(Millions of yen)
End of FY2022(December 31, 2022)
AssetsCurrent assets
Cash and deposits
Trade notes, accounts receivable and contract
assetsReal estate for sale
Real estate for sale in process
Real estate for development
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Leasehold interests in land
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Investments in silent partnerships
Long-term loans receivable
Deferred tax assets
Leasehold and guarantee deposits
Retirement benefit asset
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

86

End of FY2023(December 31, 2023)*1 82,440*1 127,305*9 14,334*9 13,887

173,836*1, *2 232,478*2, *5, *8 160,009*2 166,181

81,06940,934(93)552,531100,339
52,296(23)
692,464

396,529(174,775)*1, *2 221,754*1, *2, *4 537,397*4, *8 44,903
31,198(20,291)*1, *2 10,907*5 814,963

397,020(183,025)*1, *2 213,994*1, *2, *4 529,506*4, *8 89,428
31,920(21,284)*1, *2 10,635
843,565*1 130,042*1 127,628

1,716
887
132,646

1,486
2,509
131,624*1, *3 128,701*1, *3 153,814*3 3,638*3 2,598

458
2,001*1, *2 21,469
1,151*3 62,673(100)
219,993
1,167,603
1,720,134

4,025
2,327
*１ 20,671
1,561*3 52,711(55)
237,655
1,212,845
1,905,309

(Millions of yen)
End of FY2022(December 31, 2022)
Liabilities
Current liabilities
Short-term borrowings
Commercial papers
Current portion of bonds payable
Accounts payable - other
Income taxes payable
Provision for warranties for completed construction
Provision for bonuses
Provision for bonuses for directors (and otherofficers)
Provision for environmental measures
Deposits received under real estate specified joint
enterprise law
OtherTotal current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Provision for share-based remuneration for
directors (and other officers)
Provision for retirement benefits for directors (andother officers)
Leasehold and guarantee deposits received
Retirement benefit liability
Deposits received under real estate specified joint
enterprise law
OtherTotal non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

87

End of FY2023(December 31, 2023)*1 52,047*1 56,754

50,00010,000*1 13,781
4,811
11
950

50,00010,000*1 17,343
17,449
8
1,001

2

2

0

－

－

*2 11,300*1, *10 67,856*1, *10 76,198

199,461

240,057

245,000

255,000*1 630,520*1 715,223

17,64723,999*4 27,274*4 27,274

259

282

98

97

*1 78,088*1 77,764

13,023

14,104*2 21,684*2 10,447*1 30,236
1,063,834
1,263,296*1 33,022
1,157,216
1,397,274

92,451
66,539189,501(443)
348,048

92,451
66,262
219,528(421)
377,82150,332

71,526*4 43,187*4 43,187

4,604
(179)
97,945
10,843456,838
1,720,134

5,011
(647)
119,078
11,135508,035
1,905,309

(ii) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statement of Income(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)
Operating revenue
Operating costs
Operating gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodOther
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing fee
Bond issuance costs
Foreign exchange loss
Dividends paid on real estate specified joint enterprise
law
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Gain on sale of shares of subsidiaries and associates
Gain on sale of investments in capital of subsidiaries
and associates
Gain on bargain purchase
Gain on step acquisitions
Total extraordinary income
Extraordinary losses
Loss on sale of non-current assets
Loss on retirement of non-current assets
Impairment losses
Loss on building reconstruction
Loss on valuation of investment securities
Loss on sale of shares of subsidiaries and associates
Loss on liquidation of subsidiaries and associates
Loss on dissolution of joint venture
Total extraordinary losses
Profit before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent*7 349,940*7 375,946*1 248,452*1 266,829

101,488

109,116*2 37,009*2 38,608

64,47870,508

28
3,621

251
4,556

1,825

3,920

830
6,307

481
9,209

6,094
862
－
－

7,262
974
105
1,250

94

87

202
7,254
63,531

565
10,24669,471*3 726*3 241

50
－

－
498

－

2,265

870
12
1,659

－
－
3,004

*4 9

－

*5 139*5 150

462

157
－
－
43
－
*8 3,712
4,064
68,411
26,202(3,634)22,56845,843758
45,084*6 1,772

50
－
6
－
2,440
62,75015,5803,086
18,66644,084
1,021
43,06288

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

Consolidated Statement of Comprehensive Income(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

44,08445,843(4,021)
118(924)

21,728
2,196
(465)

2,359

(1,790)* (2,467)* 21,668

41,616

67,511

40,68066,217935

1,294

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests

89

(iii) Consolidated Statement of Changes in Equity
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Shareholders’ equity
Share capital
Balance at beginning of period

Capital surplus

92,451Retained earnings

66,587

166,356

Cumulative effects of changes inaccounting policies

Total shareholders’equityTreasury shares(439)

324,955

22

Restated balance

92,451

66,587

22

166,378(439)

324,978

Changes during period
Dividends of surplus(11,711)(11,711)

Profit attributable to owners of parent

43,06243,062

Reversal of revaluation reserve forland(8,228)(8,228)Purchase of treasury shares
Disposal of treasury shares

0Change in ownership interest ofparent due to transactions with noncontrolling interests

(4)

(4)

0

0

(48)

(48)

Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period

－

(47)

23,123(4)

23,07092,451

66,539189,501(443)

348,048

Accumulated other comprehensive income
Valuationdifferenceonavailablefor-salesecurities
Balance at beginning of period

54,276

Deferred
gains orlosses onhedges(17)

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefitplans

34,9592,144736

NonTotalaccumulated controllinginterests
othercomprehensi
ve income
92,09910,605

Cumulative effects of changes inaccounting policies
Restated balance

Total net assets

427,66122

54,276(17)

34,9592,144

736

92,09910,605

427,683

Changes during period
Dividends of surplus(11,711)

Profit attributable to owners of parent

43,062

Reversal of revaluation reserve forland(8,228)Purchase of treasury shares(4)

Disposal of treasury shares

0Change in ownership interest ofparent due to transactions with noncontrolling interests
Net changes in items other thanshareholders’ equity(48)(3,944)

17

8,228

2,460

(915)

5,846

238

6,084

Total changes during period(3,944)

17

8,228

2,460

(915)

5,846

238

29,155

Balance at end of period

50,332－

43,187

4,604

(179)

97,945

10,843456,83890

FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Shareholders’ equity
Share capital
Balance at beginning of period

Capital surplus

92,451Retained earnings

66,539Total shareholders’equityTreasury shares

189,501(443)

348,048

Changes during period
Dividends of surplus(15,057)(15,057)

Profit attributable to owners of parent

45,08445,084Purchase of treasury shares
Disposal of treasury shares

0Change in ownership interest ofparent due to transactions with noncontrolling interests

(3)

(3)

26

26

(276)

(276)

Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period

－

(276)

30,02622

29,772

92,451

66,262

219,528(421)

377,821

Accumulated other comprehensive income
Valuationdifferenceonavailablefor-salesecurities
Balance at beginning of period

50,332

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefitplans

43,187

4,604

(179)

NonTotalaccumulated controllinginterests
othercomprehensi
ve income
97,945

10,843

Total net assets

456,838

Changes during period
Dividends of surplus(15,057)

Profit attributable to owners of parent

45,084Purchase of treasury shares(3)

Disposal of treasury shares

26

Change in ownership interest ofparent due to transactions with noncontrolling interests
Net changes in items other thanshareholders’ equity(276)
21,194

－

406

(467)

21,133291

21,424

Total changes during period

21,194

－

406

(467)

21,133291

51,197

Balance at end of period

71,52643,187

5,011

(647)

119,078

11,135508,03591

(iv) Consolidated Statement of Cash Flows(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

62,75018,796
462
1,772
317
(870)
(12)

68,411
20,457
157
－
229
－
－

(1,825)(3,920)

36
5

(107)
104

(0)

－

69

22

4

(1)

(30)

－

(26)

(0)

(198)
(3,650)
6,094
50
(50)

(34)
(4,807)
7,262
－
－

－

(454)

－

(2,265)

6－－*3 3,712

(577)

(90)

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
Loss on building reconstruction
Amortization of goodwill
Gain on bargain purchase
Loss (gain) on step acquisitions
Share of loss (profit) of entities accounted for using
equity method
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for
directors (and other officers)
Increase (decrease) in provision for share-based
remuneration for directors (and other officers)
Increase (decrease) in provision for retirement benefits
for directors (and other officers)
Increase (decrease) in provision for loss on guarantees
Increase (decrease) in provision for environmental
measures
Increase (decrease) in retirement benefit liability
Interest and dividend income
Interest expenses
Loss (gain) on valuation of investment securities
Loss (gain) on sale of investment securities
Loss (gain) on sale of shares of subsidiaries andassociates
Loss (gain) on sale of investments in capital ofsubsidiaries and associates
Loss (gain) on liquidation of subsidiaries andassociates
Loss on dissolution of joint venture
Loss (gain) on sale and retirement of non-current
assetsDecrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in leasehold and guarantee deposits
received
Increase (decrease) in trade payables
Decrease (increase) in leasehold and guarantee
deposits
Increase (decrease) in deposits received
Compensation income
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes (paid) refund
Net cash provided by (used in) operating activities

92

(292)

9

*2 (65,006)*2 (73,779)(1,885)

(673)

813

809

(849)

589

3,839
－
(1,094)
18,6486,203(6,101)(22,083)(3,332)(1,593)
5,079
14,713
33,8307,491(7,035)(13,697)
20,588(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

2,188

7,641

(5,604)(3,330)

654

－

－

1,229

4,460

1,085

－
4,244
(22,495)
(433)

(16)
703
(44,796)(17,669)(1,892)63*4 (2,326)(21,204)

1,019(54,069)(0)
10,000135,500(112,534)
(202)
－
－

(0)
－
137,400(52,127)(202)
20,000(10,000)

－

(722)

(648)

－

0
(4)
(11,700)
(708)

0
(3)
(15,047)
(636)

34

40

(1,312)
18,421(789)
77,9081,545

435(4,569)87,008*1 82,439

44,86482,439*1 127,303

Cash flows from investing activities
Proceeds from sale and redemption of investment
securities
Purchase of investment securities
Proceeds from purchase of shares of subsidiaries
resulting in change in scope of consolidation
Proceeds from sale of shares of subsidiaries resulting
in change in scope of consolidation
Proceeds from withdrawal of investments in silent
partnerships
Payments for investments in silent partnerships
Proceeds from sale of non-current assets
Purchase of non-current assets
Loan advances
Increase (decrease) in deposits received under realestate specified joint enterprise law
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Increase (decrease) in commercial papers
Proceeds from long-term borrowings
Repayments of long-term borrowings
Payments for long-term accounts payable - other
Proceeds from issuance of bonds
Redemption of bonds
Purchase of shares of subsidiaries not resulting inchange in scope of consolidation
Purchase of investment equity in silent partnership ofsubsidiaries and associates not resulting in change inscope of consolidation
Proceeds from sale of treasury shares
Purchase of treasury shares
Dividends paid
Dividends paid to non-controlling interests
Proceeds from share issuance to non-controllingshareholders
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

93Notes(Significant matters that serve as the basis for preparing consolidated financial statements)
1. Scope of consolidation(1) Consolidated subsidiaries: 32 companies
Major consolidated subsidiaries
Omitted, as it is stated in “4. Information on Subsidiaries and Affiliated Companies, I. Corporate Overview.”
Tokyo Sports Wellness Village Co., Ltd., Kyoto Kawaramachi Sanjo Hotel G.K., and Tokyo Tatemono US Ltd. were
newly established and included in the scope of consolidation.
PT Dharma Tatemono Property and PT Dharma Tatemono Residences, which had been accounted for by the equity
method, are included in the scope of consolidation because they became subsidiaries as a result of the termination of
joint venture agreements with the joint venture partners.
Tokyo Tatemono Kids Co., Ltd. and Tokyo Tatemono Staffing Co., Ltd. were excluded from the scope of consolidation
due to the sale of their shares.
(2) Names of major non-consolidated subsidiaries
Tokyo Tatemono Finance Co., Ltd.
(Reason for exclusion from the scope of consolidation)
Non-consolidated subsidiaries are excluded from the scope of consolidation as they are small in terms of total assets,
sales, net income or loss, and retained earnings (in proportion to the Company’s equity interest) and do not have amaterial impact on the consolidated financial statements.
2. Matters regarding the application of the equity method(1) Affiliated companies to which the equity method has been applied
Affiliated Companies: 22 companies
Names of major companies: Kasumigaseki Kaihatsu Tokutei Mokuteki Kaisha
Wise Estate 18 Company Limited and four other companies were included in the scope of entities accounted for using
equity method due to the acquisition of its shares.
Zhejiang Fortune Xingyuan Real Estate Co., Ltd. and two other companies were excluded from the scope of
consolidation due to the transfer of equity interests.
PT Dharma Tatemono Property and PT Dharma Tatemono Residences were excluded from the scope of equity method
application because they were included in the scope of consolidation.
(2) Non-consolidated subsidiaries (Tokyo Tatemono Finance Co., Ltd., and others) and affiliates (Nissei Building
Management Co., Ltd., and others) to which the equity method is not applied do not have a material impact on the
consolidated financial statements in terms of the sum of the profit/loss and retained earnings, respectively, as apercentage of the Company’s equity interest.
(3) For those companies accounted for by the equity method whose fiscal year-end differs from the consolidated fiscal
year-end, the financial statements for their respective fiscal years are used.
3. Matters regarding the consolidated subsidiaries’ fiscal years, etc.
The following is a list of consolidated subsidiaries whose fiscal year-ends differ from the consolidated fiscal year-end.
Companies with a fiscal year ended March 31: 2 stock companies (Note) 1
Companies with a fiscal year ended June 30: 1 silent partnership (Note) 1
Companies with a fiscal year ended November 30: 1 Tokutei Mokuteki Kaisha (Note) 2(Note) 1. Financial statements based on a provisional settlement of accounts as of the consolidated balance sheet
date are used for the preparation of the consolidated financial statements.
2. The financial statements of consolidated subsidiaries as of their fiscal year-end are used.
Necessary adjustments are made for significant transactions that occurred between their fiscal year-end and the end of
the consolidated fiscal year.
The closing date of other consolidated subsidiaries is the same as the consolidated closing date.

94

4. Matters regarding accounting policies(1) Valuation criteria and valuation method for material assets
Securities
Held-to-maturity debt securities
Amortized cost method (straight-line method)
Available-for-sale securities
Stocks and securities other than non-marketable equity securities, etc.
Fair value method(Unrealized gains and losses are included directly in net assets, and the cost of securities sold is determinedby the moving average method.)
Non-marketable equity securities, etc.
Cost method based on the moving average method
Inventories
Real estate for saleSpecific Identification Inventory Valuation Method (The book value is written off due to a decline inprofitability.)
Real estate for sale in process
Same as above
Real estate for development
Same as above(2) Method of depreciation of material depreciable assets(i) The Company and its consolidated domestic subsidiaries
Property, plant and equipment (excluding leased assets)
Buildings and structures
Straight-line method
Other
Machinery and equipment
VehiclesTools, furniture and fixtures

Mainly straight-line method
Mainly declining-balance method
Same as above

However, certain domestic consolidated subsidiaries use the declining-balance method for facilities attached tobuildings and structures acquired on or before March 31, 2016. Useful lives and residual values are mainly
calculated based on the same standard as stipulated in Japan’s Corporation Tax Act.
Intangible assets (excluding leased assets)
Straight-line method
Software for internal use is amortized by the straight-line method based on the usable period in the Company (5years).
Leased assets
Leased assets related to finance lease transactions that transfer ownership
Depreciation is computed by the same method as that applied to non-current assets owned by the Company.
Leased assets related to non-ownership-transfer lease transactions
Depreciated using the straight-line method regarding the lease period as the useful life and assuming theresidual value as zero.
(ii) Foreign consolidated subsidiaries
Straight-line method(3) Accounting policy for significant deferred assets
Bond issuance costs
The entire amount is expensed at the time of expenditure.

95

(4) Recording criteria for important allowances
Allowance for doubtful accounts
To prepare for losses due to bad debts, the Company reports the expected non-collectible amount using the loan
loss ratio for general claims and individually examines the collectability of claims with a possibility of default
and bankruptcy or reorganization claims.
In the event that an allowance for doubtful accounts has been established for the entire amount of claims inbankruptcy, reorganization, or other similar claims, the allowance for doubtful accounts is directly deductedfrom the claims. As of the end of the previous consolidated fiscal year and the end of the current consolidated
fiscal year, the amount of receivables that fall under this criterion was ¥2,698 million.
Provision for warranties for completed construction
To provide for repair costs related to the completion of construction, certain consolidated subsidiaries reserve anamount based on actual repair costs incurred in previous fiscal years.
Provision for bonuses
Accrued bonuses to employees are provided for the portion of estimated bonuses to be paid in the current
consolidated fiscal year.
Provision for bonuses for directors (and other officers)
Accrued bonuses to directors and other officers of certain consolidated subsidiaries are provided based on theestimated amounts to be paid.
Provision for share-based remuneration for directors (and other officers)
To provide for the payment of the Company’s shares to the Company’s Directors and Audit & Supervisory
Board Members in accordance with the Company’s “Regulations of Directors’ Equity Benefit,” the Company
records an amount based on the estimated amount of liabilities for share benefits as of the end of the current
consolidated fiscal year.
Provision for retirement benefits for directors (and other officers)
Accrued retirement benefits for Directors and Audit & Supervisory Board Members of certain consolidated
subsidiaries are provided based on the amount payable at the end of the current consolidated fiscal year inaccordance with internal regulations.
Provision for environmental measures
To provide for expenditures for the disposal of polychlorinated biphenyls (PCBs) and other wastes, theCompany records an amount reasonably estimated to be required.
(5) Accounting for Retirement Benefits(i) Method of attributing estimated retirement benefits to periods
The estimated amount of retirement benefits is attributed to the period until the end of the current consolidated
fiscal year based on the benefit calculation method.
(ii) Method of amortizing actuarial gains and losses and past service costs
Past service costs are amortized by the straight-line method over a fixed number of years (10 years) within the
average remaining service period of employees when incurred.
Actuarial gains and losses of retirement benefits are amortized beginning with the next consolidated accounting
period, using the straight-line method over a fixed number of years (10 years) within the average remaining years ofservice of the employees when incurred in each consolidated accounting period.
(iii) Adoption of the simplified method for small companies, etc.
Certain consolidated subsidiaries apply the simplified method to calculate retirement benefit liabilities andretirement benefit expenses, using the amount payable for voluntary resignation at the end of the fiscal year as
retirement benefit obligations.

96

(6) Basis for Recognition of Significant Revenue and Expense(i) Accounting Standard for Revenue Recognition
The main performance obligations in the Group’s main businesses related to revenues arising from contracts withcustomers and the usual point in time at which such performance obligations are satisfied (the usual point in time atwhich revenues are recognized) are as follows.
In the Commercial Properties business, the Group mainly develops, sells, leases, operates, and manages officebuildings, retail facilities, and logistics facilities and has obligations to deliver real estate based on contracts withcustomers, to lease real estate, and to provide services stipulated in the contracts with customers.
In the Residential business, the Group mainly develops, subdivides, sells, leases, operates, and manages
condominiums, etc. and is obligated to deliver real estate based on contracts with customers, lease real estate, andprovide services stipulated in contracts with customers.
The Asset Service business is mainly engaged in real estate sales, brokerage, consulting, and the development andoperation of parking facilities and is obligated to deliver real estate based on contracts with customers, to mediate
real estate sales contracts, and to provide services stipulated in contracts with customers.
Of these performance obligations, the delivery obligation is satisfied at the time the property is delivered to thecustomer, and revenue is recognized at the time of delivery. The transaction price is determined based on theamount in the contract with the customer and is received at the time stipulated in the contract. With respect to salesof condominiums and other properties, a deposit is usually received as part of the transaction price at the time thecontract is concluded, and the balance is received at the time of delivery of the property.
The Group’s obligation to mediate real estate sales contracts is fulfilled at the point in time when the brokerage
property is delivered, and the Group records revenue at the time of such delivery. The transaction value isdetermined pursuant to the brokerage contract with the customer and is received in accordance with the contract.
Conversely, obligations to provide services and other items stipulated in the contract with customers are fulfilled ata point in time or over a certain period of time, depending on the nature of the service, whereby the Company
records revenues. Transaction values are determined by consignment contracts with customers and are received
based on said contracts.
For obligations to lease real estate based on contracts with customers, etc., revenue is recorded in accordance withthe “Accounting Standard for Lease Transactions” (ASBJ Statement No. 13; March 30, 2007).
In relation to the above performance obligations, no significant financial component is included in the amount ofcompensation.
Further, no significant variable consideration is recognized that could cause the amount of consideration to vary.
(ii) Recognition of revenues from finance lease transactions
Sales and cost of sales are recognized at the time of receipt of lease payments.
(7) Material hedge accounting methods(i) Hedge accounting method
Interest rate swaps that meet the requirements for special treatment are accounted for using the special treatment,
while other interest rate swaps are accounted for using the deferred hedge method.
(ii) Hedging instruments and hedged items
Hedging instrument: Interest rate swaps
Hedged items: Borrowings(iii) Hedging policy
The Company enters into interest rate swaps to hedge the impact of interest rate fluctuations on earnings and does
not enter into such swaps for speculative purposes.
The special treatment stipulated in the PITF is applied to all hedging relationships included in the scope of
application of the “Practical Solution on the Treatment of Hedge Accounting for Financial Instruments that
Reference LIBOR” (PITF No. 40; March 17, 2022). The details of hedging relationships to which the PITF isapplied are as follows.
Hedge accounting method: Special treatment is applied.
Hedging instrument: Interest rate swaps
Hedged items: Borrowings
Type of hedging transaction: Fixed cash flows(iv) Method of assessing hedge effectiveness
During the period from the inception of the hedge to the point at which its effectiveness is assessed, the Company
compares the cumulative changes in cash flows of the hedging instrument with the cumulative changes in cash

97

flows of the hedged item to determine its effectiveness. However, the effectiveness of interest rate swaps for which
special treatment is applied is not assessed.
(8) Amortization method and period of goodwill
Goodwill is amortized over an estimated number of years of substantial amortization and equally amortized overthat number of years. Amortization periods are mainly from 5 to 10 years.
(9) Scope of funds in the consolidated statement of cash flows
Funds (cash and cash equivalents) in the consolidated statement of cash flows consist of cash on hand, deposits
that can be withdrawn on demand, and short-term investments that are readily convertible to cash, risk-averse to
price fluctuations, and redeemable within three months from the date of acquisition.
(Significant accounting estimates)
1. Valuation of non-current assets(1) Amount recorded in the consolidated financial statements for the current consolidated fiscal year
(Millions of yen)

Property, plant and equipment
Intangible assets

FY2022

FY2023814,963
132,646

843,565
131,624

Impairment losses (Note)
2,234
157
(Note) The previous consolidated fiscal year includes ¥1,772 million recorded as loss on building reconstruction.
(2) Matters related to significant accounting estimates for identified items(i) Method of calculation of the amount stated above under (1).
Pursuant to the “Accounting Standard for Impairment of Fixed Assets,” when there is an indicator that an asset or
asset group may be impaired (an indication of impairment) and recovery of the investment is not expected, the bookvalue is reduced to the recoverable amount. The amount of the reduction is recorded as an impairment loss. An
indication of impairment is comprehensively assessed based on profit or loss arising from operating activities of theassets, changes in the scope or method of use, changes in the business environment, declines in market prices, etc.
The recoverable amount is the higher of the net selling price of the assets or the value in use based on estimatedfuture cash flows.
(ii) Key assumptions used in significant accounting estimates
Recoverable value is calculated for each asset or asset group using the business plan or real estate appraisal reportdeveloped based on the environment surrounding the business, past performance, and future market trends, etc. Key
assumptions are the development schedule, assumed post-development tenant rent, construction costs, and discountrate.
(iii) Effect of significant accounting estimates on the consolidated financial statements for the consolidated fiscal year
following the current consolidated fiscal year
In valuing non-current assets, the Company makes its best estimate based on the major assumptions mentioned
above under (ii); however, in the event of changes in the business environment or other factors that may cause theabove assumptions to change, it may be necessary to record additional impairment losses in the following
consolidated fiscal year or later.

982. Valuation of inventories(1) Amount recorded in the consolidated financial statements for the current consolidated fiscal year
(Millions of yen)
FY2022

FY2023

Real estate for sale
Real estate for sale in process

173,836
160,009

232,478
166,181

Real estate for development
Loss on valuation of inventory

81,0691,251

100,33933(2) Matters related to significant accounting estimates for identified items(i) Method of calculation of the amount stated above under (1).
For real estate held for sale in the ordinary course of business, the acquisition cost is used as the balance sheet
amount. If the net selling price is lower than the acquisition cost due to a decline in profitability, the net selling
price is used as the balance sheet amount in accordance with the “Accounting Standard for Measurement of
Inventories” and the difference is recorded as a reduction of book value in operating costs (loss on valuation).
(ii) Key assumptions used in significant accounting estimates
In each real estate for sale, etc., net selling price is calculated using a business plan developed based on past sales
performance, similar transactions, future market trends, etc. Key assumptions are the estimated sales amount ofcondominiums and properties for investors and the cost incurred in the future.
(iii) Effect of material accounting estimates on the consolidated financial statements for the consolidated fiscal year
following the current consolidated fiscal year
When valuing inventories, the Company makes its best estimate based on the major assumptions mentioned above
under (ii). However, if the assumptions and other factors mentioned above change due to changes in the businessenvironment or other reasons, it may be necessary to record additional write-downs of book value in the next
consolidated fiscal year or later.
3. Valuation of investments in overseas entities accounted for using equity method(1) Amount recorded in the consolidated financial statements for the current consolidated fiscal year
(Millions of yen)

Investments in foreign associates accounted for using equity
method (Note) 1
Liabilities from application of equity method (Note) 2

FY2022

FY202341,094

26,238

3,329

4,279

Share of profit of foreign associates accounted for using equity
1,532
2,260
method(Notes) 1. Figures are recorded in “investment securities” and “Other” under Investments and other assets on the
consolidated balance sheet.
2. These amounts are recorded in “Other” under non-current liabilities on the consolidated balance sheet.
(2) Matters related to significant accounting estimates for identified items
Through its overseas entities accounted for using equity method, the Group participates in the real estatedevelopment business in China, Southeast Asia and the United States, including office buildings andcondominiums.
The calculation method of the value in (1) for non-current assets held by overseas entities accounted for using
equity method is the same as that described in 1. Valuation of non-current assets.
For inventories held by overseas entities accounted for using equity method, the calculation method is the same asthat described in 2. Valuation of inventories.

99

(Changes in accounting policies)(Application of Implementation Guidance on Accounting Standard for Fair Value Measurement, etc. policies)
We have applied the “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance
No. 31; June 17, 2021; below, “Implementation Guidance on Accounting Standard for Fair Value Measurement”) from the
beginning of the current consolidated fiscal year, and we will apply the new accounting policy stipulated by the
Implementation Guidance on Accounting Standard for Fair Value Measurement prospectively in accordance with thetransitional treatment prescribed in Paragraph 27-2 of the Implementation Guidance on Accounting Standard for Fair
Value Measurement.
The impact of the application of the implementation guidance on the consolidated financial statements for the current
consolidated fiscal year is immaterial.
In addition, in the notes regarding investment trusts in the “Breakdown of Fair Value of Financial Instruments by Level”
in the (Matters related to financial instruments) Notes, no information is presented for the previous consolidated fiscal
year in accordance with Paragraph 27-3 of the Implementation Guidance of the Accounting Standard for Fair Value
Measurement.
(Unapplied accounting standards, etc.)(Accounting standard for income taxes - current, etc.)
・Accounting Standard for Current Income Taxes, etc. (ASBJ Statement No. 27; October 28, 2022)
・Accounting Standard for Presentation of Comprehensive Income (ASBJ Statement No. 25; October 28, 2022)
・Implementation Guidance on Accounting Standard for Tax Effect Accounting (ASBJ Guidance No. 28; October 28,
2022)(1) Outline
In February 2018, ASBJ Statement No. 28 “Partial Amendments to Accounting Standard for Tax EffectAccounting,” etc. (below, “ASBJ Statement No. 28”) was released, and the transfer of the practical guidelines ontax effect accounting from the Japanese Institute of Certified Public Accountants (JICPA) to the AccountingStandards Board of Japan was completed. However, during the deliberations, it was decided that the following two
issues, which were to be reconsidered after the release of ASBJ Statement No. 28, have been deliberated andreleased.
・ Category of tax expense (taxation on other comprehensive income)・ Income tax effects on sales of shares ofsubsidiaries or affiliates when group taxation regime is applied.
(2) Scheduled date of application
The new accounting standard will be applied from the beginning of the fiscal year ending December 31, 2025.
(3) Impact of the application of said accounting standards, etc.
The impact of the application of the “Accounting Standard for Current Income Taxes, etc.” and other related
standards on consolidated financial statements is currently under evaluation.
(Change in presentation method)
Consolidated statement of cash flows“Loan advances,” which was included in “Other” under “Cash flows from investing activities” in the previous consolidated
fiscal year, is presented as a separate line item in the current consolidated fiscal year due to its increased materiality interms of amount. The consolidated financial statements for the previous consolidated fiscal year have been reclassified toreflect this change in presentation.
As a result, the ¥(2,759) million presented as “Other” in “Cash flows from investing activities” in the consolidated
statements of cash flows for the previous fiscal year has been reclassified as “Loan advances” of ¥(433) million and“Other” of ¥(2,326) million.

100(Additional Information)(Board Benefit Trust (BBT))
For the purpose of raising awareness of the need to contribute to medium- and long-term growth in corporate value, theCompany has introduced a stock compensation plan, the “Board Benefit Trust (BBT)” (hereinafter referred to as the“Plan”), for Directors (excluding External Directors) and Managing Officers who do not concurrently serve as Directors of
the Company (hereinafter collectively referred to as “Directors, etc.”).
Accounting treatment for the Plan is based on the gross amount method in accordance with the “Practical Solution on
Transactions of Delivering the Company’s Own Stock to Employees, etc. through Trusts” (ASBJ Practical Issues Task
Force No. 30, issued on March 26, 2015).
1. Outline of Transaction
Under this scheme, the Company’s shares are acquired through a trust (the trust to be established under this scheme ishereinafter referred to as the “Trust”) with funds contributed by the Company. The Company shall distribute to
Directors, etc. the Company’s shares and an amount of monetary compensation equivalent to the market value of theCompany’s shares (hereinafter referred to as “the Company’s shares, etc.”) in accordance with the “Regulations of
Directors’ Equity Benefit” stipulated by the Company. In principle, the time when Directors, etc. receive the Company’s
shares, etc. is at the time of their retirement from office.
2. Shares of the Company remaining in the trust
The Company records its outstanding shares as treasury shares under net assets based on the book value (excluding theamount of incidental expenses) in the Trust. Such treasury shares recorded a book value of ¥397 million and 241,100
shares at the end of the previous consolidated fiscal year, and a book value of ¥371 million and 225,300 shares at the endof the current consolidated fiscal year.

101

(Matters related to the consolidated balance sheet)*1. Assets pledged as collateral and liabilities related to collateral are as follows.
Assets pledged as collateral(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

Real estate for sale
Buildings and structures－
63,307(－)(53,311)77
55,911(－)(51,295)

Land
Other (Property, plant and equipment)

21,459
126

(－)
(126)

21,459
131

(－)
(131)

Leasehold interests in land
Leasehold and guarantee

90,572
4,486(90,572)(4,486)90,552
4,485(90,552)(4,485)

179,951(148,496)

172,619(146,466)

deposits
Total

The figures in parentheses above indicate assets pledged as collateral for the non-recourse debt.
Liabilities related to collateral(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

Short-term borrowings

3,131(3,120)3,240(3,240)Accounts payable - other
Other (Current liabilities)

202
16

(－)
(－)

202
16

(－)
(－)

Long-term borrowings
Leasehold and guarantee

128,818
126(128,629)(－)

125,389
109(125,389)(－)

deposits received
Other (Non-current liabilities)
Total

2,028

(－)

1,825

(－)

134,324(131,749)

130,784(128,629)

The figures in parentheses above indicate non-recourse debt.
Other than the above, ¥1 million in cash and deposits (time deposits) and ¥305 million in investment securities were pledged ascollateral for guarantees of borrowings of affiliated companies in the previous consolidated fiscal year and the current consolidated
fiscal year.
*2. Relevant real estate, etc. outlined in the real estate specified joint enterprise law (silent partnership method) are as
follows.
(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

Real estate for sale
Real estate for sale in process－
10,304

8,488
7,618

Buildings and structures, etc.
Land

1,131
2,787

1,063
2,787

40

－

14,264

19,957

Leasehold and guarantee deposits
Total

The corresponding investment received is recorded in “deposits received under real estate specified joint enterprise
law.”

102

*3 The amounts due to unconsolidated subsidiaries and affiliated companies are as follows.
(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

Investment securities (stocks)
Investment securities (preferred equity)

14,728
1,533

6,820
1,646

Investment securities (Other)
Investments in silent partnerships

1
2,371

1,149
1,360

Other (Investments and other assets)(Investments in capital)

30,11022,226*4 Revaluation reserve for land
Pursuant to the Act on Revaluation of Land (Law No. 34, enacted on March 31, 1998), the Company revaluates its
commercial land, and the difference in revaluation is recorded as a component of non-current liabilities and net assets.
・Revaluation Method
Land revaluation is based on the appraisal provided under Article 2, Item 5 of the Order for Enforcement of the
Act on Revaluation of Land (Cabinet Order No. 119, enacted on March 31, 1998).
・Date of revaluation
December 31, 2000
*5 During the previous consolidated fiscal year, ¥862 million of property, plant and equipment was transferred to realestate for sale in process due to a change in the purpose of holding.
6 Guarantee liabilities and related values are as follows.
(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

4,482

769

Yangon Museum Development Pte. Ltd.
Raimon Land Twenty Six Co., Ltd.

3,394
340

2,324

Raimon Land Sathorn Co., Ltd.
PT Dharma Tatemono Property

2,021

－

11,479

－

－

1,876

302
30

1,757
30

22,051

6,758

Liable for guarantees on loans to its
customers
Liable for guarantees on loans tooverseas affiliated companies

PT Dharma Tatemono Residences
SC Asset Three Company Limited(Note)－

Liable for guarantees on loans to business
partner
Maekawa Inc.
Setoda Resort Co., Ltd.
Total
(Note) Indicates the total amount of joint guarantees.

103

7 Contingent liabilities related to debt assumption agreement for bonds
Debt performance for the following bonds has been delegated based on a trust-type debt assumption agreement (debtassumption agreement) for the bonds with a financial institution. Accordingly, the Company’s obligation to redeem thebonds to the bondholders will continue to exist until the bonds are redeemed, notwithstanding the offsetting
elimination of the debt related to the bonds and the amount payable under said agreement.
(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

18th Unsecured bond

15,000－Total

15,000－*8 Reduction entry amount deducted from the acquisition cost due to the rights exchange procedures in connection with aType 1 Urban Redevelopment Project under the Urban Renewal Act is as follows.
(Millions of yen)
End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

Real estate for sale in process

781

Construction in progress

608－
17,164

1,389

17,164Total*9 The amount of receivables and contract assets arising from contracts with customers in “trade notes, accounts
receivable, and contract assets” are presented in “Notes (Revenue-recognition) 3. Information regarding the relationshipbetween the satisfaction of performance obligations under contracts with customers and cash flows arising from suchcontracts, and the amount and timing of revenue expected to be recognized in the following consolidated fiscal year orlater from contracts with customers that existed at the end of the current consolidated fiscal year (1) Balance, etc. ofcontract assets and contract liabilities.”*10 The amount of contract liabilities in “Other (current liabilities)” is included in “Notes (Revenue-recognition) 3.
Information regarding the relationship between the satisfaction of performance obligations under contracts withcustomers and cash flows arising from such contracts, and the amount and timing of revenue expected to be recognizedin the following consolidated fiscal year or later from contracts with customers that existed at the end of the current
consolidated fiscal year (1) Balance, etc. of contract assets and contract liabilities.”(Matters related to the consolidated statement of income)*1 Inventories held for sale in the ordinary course of business written down to book value to reflect the decline inprofitability are as follows.
(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

1,251

33

Operating costs104

*2 Major items and figures of Selling, general and administrative expenses are as follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Advertising expenses
Salaries

3,684
10,906

3,704
11,301

Taxes and dues
Provision for bonuses

4,165
293

3,570
318

742

844

23

25

69

86

Retirement benefit expenses
Provision for retirement benefits for
directors (and other officers)
Provision for share-based remuneration for
directors (and other officers)*3 The breakdown of gain on sales of non-current assets is as follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Land
Buildings and structures, etc.

785
(58)

212
28

Total

726

241

*4 The breakdown of loss on sales of non-current assets is as follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Buildings and structures, etc.

9

－

Total

9

－

*5 The breakdown of loss on retirement of non-current assets is as follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Buildings and structures, etc.
Intangible assets

122
16

146
4

Total

139

150

105

*6 Loss on building reconstruction
FY2022 (January 1, 2022 to December 31, 2022)
Breakdown of loss associated with the reconstruction plan of buildings for rent is as follows.
Impairment losses
1,772 (Millions of yen)
(Note)
Total

1,772 (Millions of yen)

(Note) The Group has categorized its assets according to the smallest unit that generates cash flows that are generally
independent of the cash flows of other assets or asset groups.
The book value of a group of assets scheduled for reconstruction was reduced to the recoverable amount, andthe amount of the reduction was recorded as a loss on building reconstruction under extraordinary losses in thecurrent consolidated fiscal year.
Recoverable value is measured by value in use, and since the value in use based on future cash flows isnegative, the recoverable value is evaluated as zero.

Main Use
Building for rent

Class
Buildings andstructures, etc.

Location
Shibuya-ku, Tokyo

Loss on building
reconstruction(Millions of yen)
1,772

*7 Revenue from contracts with customers
Operating revenues are not broken down into revenues arising from contracts with customers and other revenues. The
amount of revenue from contracts with customers is included in “Notes (Revenue-recognition) 1. Information that
disaggregates revenue from contracts with customers.”*8 Loss on dissolution of joint venture
The Group participates in the Dharmawangsa Project (tentative name; below, the “Project”), a business that develops
and sells condominiums and offices in Jakarta, Indonesia, through PT Dharma Tatemono Property (below, “DTP”) andPT Dharma Tatemono Residences (together with DTP, referred to as the “project company”), which were establishedin a joint venture with joint venture partners. Due to factors including the impact of the COVID-19 pandemic and the
downturn in the real estate market leading to the stagnation of the Project, after discussions with the joint venture
partners, the joint venture agreement was dissolved and the project company was made into subsidiaries to optimize
the decision-making structure for the business restructuring of this project. In conjunction with the dissolution of thejoint venture contract, in addition to the existing shares, the shares of the project company the Group accepted as asettlement for the loan receivables to the joint venture partners, and the difference between the assets accepted and theliabilities assumed on the consolidated balance sheet have been recorded as a loss on dissolution of joint venture.

106

(Matters related to the consolidated statement of comprehensive income)*Amount of reclassification adjustment and tax effect related to other comprehensive income(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Valuation difference on available-for-salesecurities:
Amount accrued in the current period
Amount of reclassification adjustment
Before tax effect adjustment
Tax effect amount
Valuation difference on available-for-salesecurities(6,160)50

31,321(6,110)2,088

31,321(9,593)(4,021)

21,728

118

2,196

－

Foreign currency translation adjustment:
Amount accrued in the current period
Amount of reclassification adjustment
Before tax effect adjustment

－

－

118

2,196

Tax effect amount－－Foreign currency translation adjustment

118

2,196

tax:
Amount accrued in the current period(1,056)(517)

Amount of reclassification adjustment

(275)

(153)

(1,331)(670)

Remeasurements of defined benefit plans, net of

Before tax effect adjustment
Tax effect amount

407

205

Remeasurements of defined benefit plans,
net of tax

(924)

(465)

2,816
17

(388)
(1,102)

Before tax effect adjustment
Tax effect amount

2,834
(474)

(1,490)(299)

Share of other comprehensive income ofentities accounted for using equity method

2,359(1,790)Total other comprehensive income(2,467)

21,668

Share of other comprehensive income of entities
accounted for using equity method:Amount accrued in the current period
Amount of reclassification adjustment

107

(Matters related to the consolidated statement of changes in equity)
FY2022 (January 1, 2022 to December 31, 2022)
1. Matters regarding issued sharesClass of shares

Beginning of
consolidated FY2022

Common shares(shares)

209,167,674

Increase

End ofconsolidated FY2022

Decrease－

209,167,674－

2. Matters regarding treasury shares
Beginning of
consolidated FY2022

Class of shares

Increase

End ofconsolidated FY2022

Decrease

Common shares
276,104
2,428
102(shares)(Note) Common shares include 241,100 shares of the Company’s shares held by the Board Benefit Trust (BBT).

278,430(Summary of reasons for fluctuation)
Breakdown of the number of shares increased is as follows.
Increase due to purchase of shares of less than one unit

2,428 shares

Breakdown of the number of shares decreased is as follows.
Decrease due to demand for purchasing of shares of less than one unit

102 shares

3. Matters regarding dividends(1) Dividends paid
Resolution

Class ofsharesTotal Dividend
AmountDividend
amount(Millions of yen) per share (yen)Record date

Effective date

March 29, 2022
Ordinary General
Common5,646
27 December 31, 2021 March 30, 2022
Meeting ofsharesShareholders(Note) The total value of dividends includes dividends of ¥6 million for shares of the Company's stock held by the Board Benefit
Trust (BBT).

Resolution

Class ofsharesAugust 10, 2022
Board of Directors

CommonsharesTotal Dividend
AmountDividend
amount(Millions of yen) per share (yen)
6,064

29

Record date

Effective dateJune 30, 2022

September 2, 2022

(Note) The total value of dividends includes dividends of ¥6 million for shares of the Company’s stock held by the Board Benefit
Trust (BBT).
(2) Dividend with a record date belonging to the current consolidated fiscal year and with an effective date belonging
to the following consolidated fiscal year
Resolution

Class ofsharesFinancial
Total Dividend
DividendsourceAmountamountof dividends (Millions of yen) per share (yen)Record date

Effective date

March 29, 2023
Ordinary General
CommonRetained
7,528
36 December 31, 2022 March 30, 2023
Meeting ofsharesearnings
Shareholders(Note) The total value of dividends includes dividends of ¥8 million for shares of the Company’s stock held by the Board Benefit
Trust (BBT).

108

FY2023 (January 1, 2023 to December 31, 2023)
1. Matters regarding issued sharesClass of shares

Beginning of
consolidated FY2023

Common shares(shares)

209,167,674

Increase

End ofconsolidated FY2023

Decrease－

209,167,674－

2. Matters regarding treasury shares
Beginning of
consolidated FY2023

Class of shares

Increase

End ofconsolidated FY2023

Decrease

Common shares
278,430
2,089
16,038(shares)(Note) Common shares include 225,300 shares of the Company’s shares held by the Board Benefit Trust (BBT).

264,481(Summary of reasons for fluctuation)
Breakdown of the number of shares increased is as follows.
Increase due to purchase of shares of less than one unit

2,089 shares

Breakdown of the number of shares decreased is as follows.
Decrease due to demand for purchasing of shares of less than one unit
Decrease due to grant through Board Benefit Trust (BBT)

238 shares
15,800 shares

3. Matters regarding dividends(1) Dividends paid
Resolution

Class ofsharesTotal Dividend
AmountDividend
amount(Millions of yen) per share (yen)Record date

Effective date

March 29, 2023
Ordinary General
Common7,528
36 December 31, 2022 March 30, 2023
Meeting ofsharesShareholders(Note) The total value of dividends includes dividends of ¥8 million for shares of the Company’s stock held by the Board Benefit
Trust (BBT).

Resolution

Class ofsharesAugust 10, 2023
Board of Directors

CommonsharesTotal Dividend
AmountDividend
amount(Millions of yen) per share (yen)
7,528

36

Record date

Effective dateJune 30, 2023

September 8, 2023

(Note) The total value of dividends includes dividends of ¥8 million for shares of the Company’s stock held by the Board Benefit
Trust (BBT).
(2) Dividends with a record date belonging to the current consolidated fiscal year and with an effective date belonging
to the following consolidated fiscal year
Resolution

Class ofsharesFinancial
Total Dividend
DividendsourceAmountamountof dividends (Millions of yen) per share (yen)Record date

Effective date

March 27, 2024
Ordinary General
CommonRetained
7,737
37 December 31, 2023 March 28, 2024
Meeting ofsharesearnings
Shareholders(Note) The total value of dividends includes dividends of ¥8 million for shares of the Company’s stock held by the Board Benefit
Trust (BBT).

109

(Matters related to the consolidated cash flow statement)*1 The reconciliation of cash and cash equivalents at the end of period and the accounts disclosed in the consolidatedbalance sheet are as follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Cash and deposits
Time deposits with a deposit term

82,440127,305(1)(1)

82,439127,303exceeding three months
Cash and cash equivalents*2 Increase/decrease in inventories includes increase/decrease in accounts payable and advances related to inventories.
*3 Significant non-cash transactions
FY2023 (January 1, 2023 to December 31, 2023)
Assets received and liabilities assumed in connection with the conversion of PT Dharma Tatemono Property and PT
Dharma Tatemono Residences into subsidiaries are as follows.
(Millions of yen)
Current assets
Non-current assets

14,722136

Current liabilities
Non-current liabilities(54)(13,592)

Total

1,212

Loans receivable
Shares of associates(4,318)(606)

Difference: loss on dissolution of joint
venture(3,712)*4 Consolidated cash flows related to the acquisition of additional shares of EXPERT OFFICE Co., Ltd. on January 17,2022 are included in “Other” of cash flows from investing activities.

110

(Matters related to lease transactions)1. Finance lease transactions(Lessee side)
Non-ownership-transfer finance lease transactions(1) Content of leased assets
・Property, plant and equipment mainly consists of buildings in the leisure business.
(2) Method of depreciation of leased assets
Please refer to “(Significant matters that serve as the basis for preparing consolidated financial statements) 4.
Matters regarding accounting policies, (2) Method of depreciation of material depreciable assets.”(Lessor side)
Non-ownership-transfer finance lease transactions(1) Breakdown of lease investment assets
Current assets(Millions of yen)
FY2022(December 31, 2022)

FY2023(December 31, 2023)

Gross lease receivables

8,398

8,086

Estimated Residual Value－－

Unearned interest income(3,340)(3,138)Investments in leases

5,057

4,948

(2) Estimated amount of collection of the portion of lease receivables related to investments in leases after the date of
the consolidated settlement of accounts
Current assets(Millions of yen)
FY2022(December 31, 2022)
Over one

Within one
year
Investments in leases

Over twoOver three Over four
year andyears andyears within years within
within two within threefour years
five years
years
years

311

311

311

311

311

Over five
years
6,840

(Millions of yen)
FY2023(December 31, 2023)
Over one

Within one
year
Investments in leases

Over twoOver three Over four
year andyears andyears within years within
within two within threefour years
five years
years
years

311

311

111

311

311

311

Over five
years
6,528

2. Operating lease transactions(Lessee side)
Future minimum lease payments under non-cancelable operating lease transactions(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

Within one year

6,844

9,070

Over one year

123,675

134,899

Total

130,520

143,970(Lessor side)
Future minimum lease receives under non-cancelable operating lease transactions(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

Within one year

32,22331,090Over one year

116,538

134,402

Total

148,762

165,492

112

(Matters related to financial instruments)
1. Matters regarding the status of financial instruments(1) Policy on financial instruments
For fund management, the Group limits fund management to short-term deposits, etc. and raises necessary funds
mainly through bank borrowings and bond issues. Derivatives transactions are used to avoid the risks described below,
and the Company’s policy is not to engage in speculative transactions.
(2) Content and risk of financial instruments
Marketable securities and investment securities are mainly equity securities of companies with which the Company
has business relationships and are exposed to the credit risk of the issuers, interest rate fluctuation risk, and market
price fluctuation risk, respectively.
Investments in silent partnerships are mainly investments in special purpose companies and are exposed to the issuer’s
credit risk and interest rate fluctuation risk.
Short-term borrowings and commercial papers are mainly for procuring working capital, while long-term borrowings
and bonds are mainly for procuring funds necessary for capital investment, etc. A portion of these borrowings havefloating interest rates and are exposed to interest rate fluctuation risk. The Company hedges against interest rate
fluctuation risk by using derivative transactions (interest rate swaps) to avoid interest rate fluctuation risk and fix theinterest rate payable for a portion of these borrowings.
(3) Risk management system related to financial instruments(i) Management of credit risk (Risks related to non-performance of contracts by counterparties, etc.)
The Group’s departments in charge of trade receivables monitor the status of major customers in order to identify andmitigate the risk of collection at an early stage due to deterioration of their financial conditions or other factors.
(ii) Management of market risk (Risk of fluctuations in foreign exchange rates, interest rates, etc.)
The Group utilizes interest rate swap transactions to reduce the risk of fluctuations in interest rates payable on
borrowings, etc. Marketable securities and investment securities are periodically reviewed for fair value and financial
conditions of the issuers (counterparty companies), and their holding status is regularly reviewed in consideration ofmarket conditions and the relationship with the counterparty companies.
(iii) Management of liquidity risk (Risk of failure to make payment when due) related to financing
Based on reports from each department, the Group manages liquidity risk by having the department in charge prepare
and update funding plans in a timely manner and by maintaining liquidity on hand.
(4) Supplementary explanation on matters regarding the fair value, etc. of financial instruments
In calculating the reasonable value used when financial instruments have no market price, variable factors areincorporated, and the value could change by adopting different preconditions, etc.

113

2. Matters regarding the fair value, etc. of financial instruments
The amount recorded on the consolidated balance sheet, the fair values and their differences are as follows.
Cash is omitted from the notes and deposits, short-term borrowings and commercial papers are omitted from the notes as
they are settled quickly, and their fair value approximates their book value.
The fair value of derivatives transactions for which special treatment of interest rate swaps is applied is included in thefair value of the relevant long-term borrowings, etc. as they are accounted for as an integral part of the hedged long-termborrowings payable, etc.
FY2022 (December 31, 2022)
Amount recorded on
the consolidatedbalance sheet(Millions of yen)

Fair value(Millions of yen)

Difference(Millions of yen)

106,810

106,810－

106,810

106,810－(1) Current portion of long-term borrowings
and long-term borrowings

682,460

673,522(8,938)(2) Current portion of bonds payable and bonds
payable255,000

248,037(6,963)

937,460

921,559(15,901)

Amount recorded on
the consolidatedbalance sheet(Millions of yen)

Fair value(Millions of yen)

Difference(Millions of yen)

139,730

139,730－

139,730

139,730－(1) Current portion of long-term borrowings
and long-term borrowings

771,870

760,127(11,743)(2) Current portion of bonds payable and bonds
payable265,000

259,841(5,159)1,036,870

1,019,968(16,902)(1) Marketable securities and investment
securities
Available-for-sale securities
Total assets

Total liabilities
FY2023 (December 31, 2023)(1) Marketable securities and investment
securities
Available-for-sale securities
Total assets

Total liabilities

114

(Note) 1. Carrying amount of non-marketable equity securities and investments in partnerships, etc.
(Millions of yen)
Category

December 31, 2022

December 31, 2023

(i) Unlisted shares, etc.

3,516

3,628

(ii) Investments in partnerships, etc. (*)

2,026

2,077

(*) Investments in partnerships, etc. are mainly investments in silent partnerships. In the previous consolidated
fiscal year, these were not subject to fair value disclosure in accordance with Paragraph 27 of the
Implementation Guidance on Accounting Standard for Fair Value Measurement (ASBJ Guidance No. 31; July4, 2019). In the current consolidated fiscal year, these were not subject to fair value disclosure in accordancewith Paragraph 24-16 of the Implementation Guidance on Accounting Standard for Fair Value Measurement(ASBJ Guidance No. 31; June 17, 2021; below, the “Implementation Guidance on Accounting Standard for Fair
Value Measurement”).
2. Value of monetary claims with a maturity to be redeemed after the consolidated closing date
FY2022 (December 31, 2022)(Millions of yen)Over one year andwithin five years

Over five years andwithin 10 years

81,700

－

－

－

－

－

－

3,000

81,700

－

－

3,000

Within one year
Cash and deposits
Available-for-salesecurities
Bonds
Bonds payable
Total

Over 10 years

FY2023 (December 31, 2023)(Millions of yen)Over one year andwithin five years

Over five years andwithin 10 years

124,403

－

－

－

－

－

－

3,000

124,403

－

－

3,000

Within one year
Cash and deposits
Available-for-salesecurities
Bonds
Bonds payable
Total

Over 10 years

3. Value of long-term borrowings, bonds payable, and other interest-bearing debt to be repaid after the consolidated
closing date
FY2022 (December 31, 2022)(Millions of yen)Over one
Within one
year
year
and within
two years

Over twoyears
and within
three years

Over three
years
and withinfour years

Over fouryears
and within
five years

Over five
years

－

－

－

－

Short-term borrowings

107

Commercial papers

50,000

－

－

－

－

－

Bonds payable

10,00010,00020,00010,00010,000

195,000

51,93956,66080,95265,33080,801

346,776

112,047

66,660100,952

75,33090,801

541,776

Long-term borrowings
Total

－

115

FY2023 (December 31, 2023)(Millions of yen)Over one
Over twoOver three Over fourWithin one year andyears andOver five
years within years within
year
within two within threeyears
four years five years
years
years
Short-term borrowings

106

－

－

－

－

－

Commercial papers

50,000

－

－

－

－

－

Bonds payable

10,00020,00010,00010,00020,000

195,000

Long-term borrowings

56,64780,93969,646

81,47197,457385,708

116,754

100,939

79,646

91,471

117,457

580,708

Total

116

3. Breakdown of Fair Value of Financial Instruments by Level
The fair value of financial instruments is classified into the following three levels based on the observability andmateriality of the inputs used to calculate fair value.
Level 1 fair value: Fair value calculated based on quoted market prices for assets or liabilities for which such fairvalue is calculated in an active market among the inputs used to calculate observable fair value.
Level 2 fair value: Fair value calculated using inputs other than Level 1 inputs to the calculation of observable fairvalue.
Level 3 fair value: Fair value calculated using inputs related to the calculation of unobservable fair value.
When multiple inputs that significantly affect fair value are used, fair value is classified into the level with the lowest
priority in the fair value calculation among the levels to which those inputs belong.
(1) Financial instruments carried on the consolidated balance sheet with fair value
FY2022 (December 31, 2022)
Fair value (Millions of yen)
Category
Level 1

Level 2

Level 3

Total

Marketable securities and investment
securities (Note) 1
Available-for-sale securities
Stocks90,131－－90,131

Bonds

－

2,992

－

2,992

Other

13,151－534

13,686103,283

2,992

534

106,810

Total assets
FY2023 (December 31, 2023)

Fair value (Millions of yen)
Category
Level 1

Level 2

Level 3

Total

Marketable securities and investment
securities (Note) 1
Available-for-sale securities
Stocks122,194－－

122,194

Bonds

－

3,033

－

3,033

Other

12,414－592

13,006

134,609

3,033

592

138,235

Total assets117

(2) Financial instruments other than those recorded at fair value in the consolidated balance sheet
FY2022 (December 31, 2022)
Fair value (Millions of yen)
Category
Level 1

Level 2

Level 3

Total

Current portion of long-term borrowings
and long-term borrowings－

673,522－673,522

Current portion of bonds payable andbonds payable－

248,037－

248,037

Total liabilities－

921,559－

921,559

FY2023 (December 31, 2023)
Fair value (Millions of yen)
Category
Level 1
Current portion of long-term borrowings
and long-term borrowings
Current portion of bonds payable andbonds payable
Total liabilities

Level 2

Level 3

Total－

760,127－

760,127－

259,841－

259,841－

1,019,968－

1,019,968(Notes) 1. In the previous consolidated fiscal year, investment trusts to which transitional measures were applied are notincluded in the table above in accordance with Paragraph 26 of the Implementation Guidance on AccountingStandard for Fair Value Measurement (ASBJ Guidance No. 31; July 4, 2019). The amount of such investment
trusts, etc. in the consolidated balance sheet is ¥1,352 million.
In the current consolidated fiscal year, investment trusts whose investment trust assets are real estate to which
the Company applied the treatment in Paragraph 24-9 of the Implementation Guidance for Accounting Standard
for Fair Value Measurement are not included in the table above. The amount of such investment trusts, etc. in
the consolidated balance sheet is ¥1,495 million.
A note for reconciliation of the beginning and ending balance is omitted due to immateriality.
2. Valuation techniques used in the calculation of fair value and explanation of inputs related to the calculation offair value
Assets(1) Marketable securities and investment securities
Listed stocks are priced on the stock exchange and classified as Level 1 fair value based on market
activity.
Marketable bonds (corporate bonds) are based on trading reference price, etc. and are classified as
Level 2 fair value.
Listed real estate investment trusts are priced on the stock exchange and classified as Level 1 fair value
based on market activity.
Non-marketable preferred securities are valued using the adjusted net asset value method, which isbased on the market value of real estate held by the investee and are classified as Level 3 fair value as
the impact of unobservable inputs on the fair value is significant.
Liabilities(1) Current portion of long-term borrowings and long-term borrowings
Fair values of these are calculated by discounting the sum of the principal and interest by the interest
rate applicable to a similar new borrowing.
Floating interest rate (excluding those subject to special treatment for interest rate swaps) is based on
the book value, as it reflects the market interest rate in a short period of time, and the fair value isapproximate to the book value.
Fair values of long-term borrowings with floating interest rates that qualify for special treatment asinterest rate swaps are calculated by discounting the sum of the principal and interest that are accounted

118

for together with the interest rate swaps by the interest rate that would be applicable if similar new
borrowings were made.
These are classified as Level 2 fair value.
(2) Current portion of bonds payable and bonds payable
The fair value of bonds issued by the Company is based on trading statistics, etc. and is classified as
Level 2 fair value.
3. Fair value information for Level 3 financial assets and liabilities that are carried at fair value on the
consolidated balance sheet
Information on Level 3 financial instruments has been omitted due to the immateriality of said financial
instruments.

119

(Matters related to securities)
1. Available-for-sale securities
FY2022 (December 31, 2022)
Amount recorded on the
consolidated balance sheet(Millions of yen)
Securities of which the amount recorded on
the consolidated balance sheet exceeds theacquisition cost(i) Stocks

Acquisition cost
(Millions of yen)

Difference(Millions of yen)

89,01021,775

67,235

－

－

－

－
－
13,298

－
－
7,331

－
－
5,966

102,309

29,107

73,201

1,120

1,334

(214)

－
2,992

－
3,000

－
(7)

－
388

－
410

－
(22)

Subtotal

4,501

4,745

(243)

Total

106,81033,852

72,958(ii) Bonds
Government bonds
Corporate bonds
Other(iii) Other
Subtotal
Securities of which the amount recorded on
the consolidated balance sheet does notexceed the acquisition cost(i) Stocks(ii) Bonds
Government bonds
Corporate bonds
Other(iii) OtherFY2023 (December 31, 2023)
Amount recorded on the
consolidated balance sheet(Millions of yen)
Securities of which the amount recorded on
the consolidated balance sheet exceeds theacquisition cost(i) Stocks(ii) Bonds

Acquisition cost
(Millions of yen)

Difference(Millions of yen)

121,638

22,69998,939

－
3,033

－
3,000

－
33

－
14,134

－
8,683

－
5,451

138,807

34,382

104,424

556

712

(156)

－
－

－
－

－
－

－
367

－
411

－
(43)

Subtotal

923

1,124

(200)

Total

139,730

35,506104,223

Government bonds
Corporate bonds
Other(iii) Other
Subtotal
Securities of which the amount recorded on
the consolidated balance sheet does notexceed the acquisition cost(i) Stocks(ii) Bonds
Government bonds
Corporate bonds
Other(iii) Other120

2. Available-for-sale securities sold during the consolidated fiscal year
FY2022 (January 1, 2022 to December 31, 2022)
Sales amount

Total gain on sale

Total loss on sale(Millions of yen)

(Millions of yen)

(Millions of yen)

Stocks

2,067

50

－

FY2023 (January 1, 2023 to December 31, 2023)
Not applicable.
3. Securities for which impairment losses were recognized
In the previous consolidated fiscal year, an impairment loss of ¥50 million was recognized for securities with market
quotations.
There is no applicable information for the current consolidated fiscal year.
The criteria for impairment are as follows.
Marketable securities: In the event of a 50% or more decline in real value compared to acquisition cost or in the eventof a 30% or more but less than 50% decline for three consecutive consolidated fiscal years,
including the current fiscal year-end.
Non-marketable securities: In the event of a 50% or more decline in the market value compared to the acquisition cost(unless the possibility of recovery can be supported by sufficient evidence) or if a loss isdeemed certain due to liquidation, etc.
(Matters related to derivatives transactions)
Derivatives transactions for which hedge accounting is applied
Interest rate-related
FY2022 (December 31, 2022)
Contract

Contract amount

Fair value

over one year
(Millions of yen)

(Millions ofyen)

15,174

12,606(Note)

15,174

12,606－

Method of hedge

Type of derivatives

Main hedged

amountaccounting

transaction, etc.

items

(Millions ofyen)Special treatment
of interest rate
swaps

Interest rate swap
transactions fixedpayable/floating

Borrowings

receivable
Total(Note) Interest rate swaps for which special treatment is applied are accounted for together with the hedged borrowings.
Accordingly, their fair value is included in the fair value of such borrowings.
FY2023 (December 31, 2023)
Contract

Contract amount

Fair value

over one year
(Millions of yen)

(Millions ofyen)

12,606

10,018(Note)

12,606

10,018－

Method of hedge

Type of derivatives

Main hedged

amountaccounting

transaction, etc.

items

(Millions ofyen)Special treatment
of interest rate
swaps

Interest rate swap
transactions fixedpayable/floating

Borrowings

receivable
Total(Note) Interest rate swaps for which special treatment is applied are accounted for together with the hedged borrowings.
Accordingly, their fair value is included in the fair value of such borrowings.

121

(Matters related to retirement benefits)
1. Outline of retirement benefit plans adopted
The Company has a defined benefit corporate pension plan and a lump-sum severance payment plan as a defined benefit
plan, and a defined contribution pension plan as a defined contribution plan.
Certain consolidated subsidiaries provide lump-sum severance payment plans. Some consolidated subsidiaries also
participate in a defined contribution corporate pension plan and a mutual aid system for small and medium-sizedenterprise retirement allowances.
A simplified method is used to calculate retirement benefits for a part of the Company and some of its consolidated
subsidiaries.
2. Defined benefit plan
(1) Reconciliation of the beginning and ending balance of retirement benefit obligation (excluding plans to which thesimplified method is applied, which are listed in (3))(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

22,21422,737

1,245

1,253

129
265

132
221

(1,116)－(1,094)970－

53

22,737

24,274

Balance of retirement benefit obligation at the
beginning of period
Service cost
Interest expense
Actuarial gains (losses)
Retirement benefits paid
Amount of past service cost
Increase due to new consolidation
Balance of retirement benefit obligation at the end of
period(2) Reconciliation between the beginning and ending balances of plan assets (excluding plans to which the simplified
method is applied, which are listed in (3))(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

12,811

12,266

Expected return on plan assets
Actuarial gains (losses)

192
(791)

183
675

Contribution from employer
Retirement benefits paid

305
(252)

303
(259)

12,266

13,169Balance of plan assets at the beginning of period

Balance of plan assets at the end of period(3) Reconciliation of the beginning and ending balances of retirement benefit liability for plans to which the simplified
method is applied(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

1,336

1,400

172
(108)

196
(139)

Decrease due to exclusion from consolidation

－

(19)

Balance of retirement benefit liability at the end of
period

1,400

1,438

Balance of retirement benefit liability at the beginningof period
Retirement benefit expenses
Retirement benefits paid122

(4) Reconciliation of balance of retirement benefit obligation and plan assets at the end of the period and retirement benefit
liability and retirement benefit asset recognized in the consolidated balance sheet(Millions of yen)
End of FY2022(December 31, 2022)
Retirement benefit obligation of funded plans

End of FY2023(December 31, 2023)

11,115

11,608Plan assets(12,266)(13,169)

Retirement benefit obligation of non-funded plans(1,151)
13,023(1,561)
14,104

Net liabilities and assets recorded in the consolidatedbalance sheet

11,872

12,542Retirement benefit liability
Retirement benefit asset

13,023(1,151)

14,104(1,561)

Net liabilities and assets recorded in the consolidatedbalance sheet

11,872

12,542(5) Amount of retirement benefit expenses and the breakdown(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Service cost

1,245

1,253

Interest expense
Expected return on plan assets

129
(192)

132
(183)

Amortization of actuarial gains (losses)
Expense amount processed for past service cost

(275)
－

(158)
4

172

196

1,079

1,244

Retirement benefit expenses calculated by thesimplified method
Retirement benefit expenses for defined benefit plans(6) Remeasurements of defined benefit plans
The components of the items recorded in remeasurements of defined benefit plans (before tax effect deductions) are as
follows:(Millions of yen)

Past service cost
Actuarial gains (losses)
Total

FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

－
1,331

966
(295)

1,331

670

(7) Accumulated remeasurements of defined benefit plans
The components of the items recorded in accumulated remeasurements of defined benefit plans (before deducting tax
effect) are as follows:(Millions of yen)
End of FY2022(December 31, 2022)
Unrecognized past service cost
Unrecognized Actuarial gains (losses)
Total

123

End of FY2023(December 31, 2023)
－
269

966
(26)

269

940

(8) Matters related to pension plan assets(i) Major breakdown of pension plan assets
The following is a breakdown of the major categories of pension plan assets as a percentage of total pension plan
assets.
End of FY2022(December 31, 2022)

End of FY2023(December 31, 2023)

Bonds

36.1 %

35.1 %

StocksGeneral accounts

20.3
10.6

23.9
9.8

Investment trusts
Other

27.5
5.5

25.2
6.0

100.0

100.0

Total

(ii) Method of establishing the expected long-term rate of return on pension assets
To determine the long-term expected rate of return on pension plan assets, the Company considers the past andexpected rate of return of each asset comprising the pension plan assets.
(9) Matters related to actuarial basis
Principal actuarial basis

Discount rate

FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

0.4-0.6 %Long-term expected rate of return on plan assets
Expected rate of salary increase

0.4-6.3 %

1.5

1.5

0.0-7.6

0.0-7.6

3. Defined Contribution Plan
The required contribution to the defined contribution plan by the Company and its consolidated subsidiaries was ¥467
million in the previous consolidated fiscal year and ¥492 million in the current consolidated fiscal year.

124

(Matters related to tax effect accounting)
1. Breakdown of deferred tax assets and deferred tax liabilities by major cause
End of FY2022(December 31, 2022)
Deferred tax assets
Tax loss carryforward
Retirement benefit liability
Impairment losses
Depreciation of real estate for sale
Loss on valuation of shares of subsidiaries andassociates
Excess depreciation
Unrealized gains (losses) on distributions fromsilent partnerships
Compensation income
Adjustments due to unification of accounting
treatment between parent and subsidiaries, etc.
Enterprise taxes payable
Other(Millions of yen)
End of FY2023(December 31, 2023)

1,018
4,017
10,826
2,345
1,082

1,080
4,041
10,721
2,950
1,084

647
2,066

696
1,983

704
7,977

1,964
7,791

503
7,061

1,189
9,340

Subtotal of deferred tax assets
Valuation allowance

38,249(21,177)

42,844(22,437)

Total deferred tax assets

17,072

20,406(24,113)(3,181)(2,579)(33,702)(3,166)(2,572)(398)(2,445)(1,006)(1,631)

Total deferred tax liabilities(32,718)(42,078)

Net deferred tax assets (liabilities)(15,645)(21,672)

Deferred tax liabilities
Valuation difference on available-for-sale securities
Revaluation of subsidiary assets
Reserve for tax purpose reduction entry of
replacement assets
Retained earnings of affiliates
Other(Change in presentation method)“Depreciation of real estate for sale” and “Enterprise taxes payable,” which were included in “Other” in the previous
consolidated fiscal year, are presented separately in the current consolidated fiscal year due to their increased materiality.
On the other hand, “Provision for retirement benefits for directors (and other officers),” “Loss on valuation of real estate
for sale,” and “Loss on valuation of investment securities,” which were separately presented in the previous consolidated
fiscal year, are included in “Other” in the current consolidated fiscal year due to their decreased materiality. The notes forthe previous consolidated fiscal year have been reclassified to reflect this change in presentation.

125

2. Breakdown by major cause when there is a significant difference between statutory tax rate and effective tax rate
End of FY2022(December 31, 2022)
Statutory tax rate
(Adjustment)
Increase (decrease) in valuation allowanceEntertainment expense(s) and other items not
permanently deductible for income tax purposes
Dividends income and other items not
permanently includable in income
Inhabitant tax on per capita basis
Foreign withholding tax
Foreign tax credit
Dividends paid deducted as expenses
Share of profit (loss) of entities accounted for using
equity method
Dividends from consolidated subsidiaries and entities
accounted for using equity method
Other

End of FY2023(December 31, 2023)－

30.6 %

－

2.6

－

2.3

－

(3.4)

－
－
－
－

0.1
0.4
(0.3)
(0.2)

－

(1.8)

－

2.4

－
0.3
－
Effective tax rate
33.0
(Note) In the previous consolidated fiscal year, the difference between the statutory tax rate and the effective tax rate
after the application of tax effect accounting was less than 5% of the statutory tax rate; thus, notes are omitted.
(Matters related to leasing real estate properties)
The Company and some of its consolidated subsidiaries own leasing office buildings, leasing condominiums, and leasing
retail facilities, etc. in Tokyo and other areas. Some leasing office buildings and other properties are used by the Company
and some of its consolidated subsidiaries and therefore are classified as real estate including portions used as leasing
properties.
The amount recorded on the consolidated balance sheet, changes during period, and fair value of these leasing properties
and real estate, including portions used as leasing properties, are as follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

693,406

692,631

Changesduring period

(775)

9,324

Balance at the692,631701,955

1,179,703

1,196,349

199,175

198,568

Changesduring period(606)

16,891

Balance at the

198,568

215,459

237,908

250,481

Balance at the

Leasing real estate
properties

Amount recorded on the
consolidated balance sheet

beginning of
periodend of periodMarket value at the end of period
Balance at theReal estate including
portions used as leasing
property

Amount recorded on the
consolidated balance sheet

beginning of
periodend of periodMarket value at the end of period(Notes) 1. The amount recorded on the consolidated balance sheet is the amount obtained by subtracting accumulated depreciationfrom acquisition costs.
2. Among changes during period, the major increases in the previous consolidated fiscal year were ¥13,155 million for theacquisition of real estate and ¥5,110 million from an increase in real estate in connection with the accumulation of a
newly consolidated subsidiary. The primary decreases were depreciation of ¥13,232 million and sales of real estate of¥3,450 million.

126

The major increase in the current consolidated fiscal year was ¥40,077 million for the acquisition of real estate. The
primary decrease was a depreciation of ¥13,402 million.
3. The market value at the end of the period is the value based on the valuation of properties by an outside licensed realestate appraiser for principal properties and the value calculated by the Company based on the Real Estate Appraisal
Standards (including values adjusted using indicators) for other properties.
Income (loss) from real estate that includes leasing properties and portions of real estate used as leasing properties are as
follows.
(Millions of yen)
FY2022

FY2023(Jan. 1, 2022 to Dec. 31, 2022)(Jan. 1, 2023 to Dec. 31, 2023)

Leasing revenue

86,49689,728

Leasing real estate

Leasing expenses

55,87058,153properties

Difference

30,62531,574

Other gains (losses)(1,982)

28

Leasing revenue

8,369

8,098

Leasing expenses

5,289

4,535

Difference

3,080

3,562

266

(1)

Real estate including
portions used as leasing
property(Note) 1.

2.

Other gains (losses)

Since real estate that includes portions used as leasing properties also includes portions used by the Company and someof its consolidated subsidiaries for the provision of services and business administration, leasing revenue is not recorded
for these portions. Expenses related to such portions (rent, depreciation, building management fees, taxes and dues, etc.)
are included in leasing expenses.
Other gains (losses) in the previous consolidated fiscal year mainly consisted of loss on building reconstruction and gainon sale of non-current assets.

(Revenue-recognition)
1. Information that disaggregates revenue from contracts with customers
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Reportable segments
Commercial
Properties
Business

Real estate sales
Real-estate leasing

Residential
Business

Asset
Service

Other
Total

Business

Business(Note)1

Total

148,360
88,412Other service offerings

38,607

22,622

28,78390,013－－23,154

Revenues from external customers

145,155

131,390

50,240326,786

23,154349,940

Revenue from contracts with customers
Revenue from other sources (Note)272,01973,135

117,601
13,78942,202
8,038

231,823
94,963

22,539614

254,362
95,578

Revenues from external customers

145,155

131,390

50,240326,786

23,154349,940

29,812
76,735

103,458
5,309

15,0896,367

148,360
88,412

113,167(Notes) 1. The “Other” business segment is not included in reportable segments. “Other” includes businesses such as“Leisure business,” “Asset Management business,” and “Overseas businesses.”
2. “Revenue from other sources” includes leasing income in accordance with ASBJ Statement No. 13,“Accounting Standard for Lease Transactions,” and real estate sales in accordance with the Accounting
System Committee Report No. 15, “Practical Guidelines for Accounting for Transferees in Securitization ofReal Estate Using Special Purpose Companies.”127

FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Reportable segments
Commercial
Properties
Business

Residential
Business

Asset
Service

Other
Total

Business

Business(Note)1

Total

168,585
90,894

Real estate sales
Real-estate leasing

38,64378,275

104,693
5,948

25,248
6,670

168,585
90,894

Other service offerings

38,33723,49831,881

93,717－－22,748

Revenues from external customers

155,256

134,140

63,800353,198

22,748375,946

Revenue from contracts with customers
Revenue from other sources (Note)276,96878,287110,738
23,401

48,56915,231

236,277
116,921

22,134614

258,411
117,535

Revenues from external customers

155,256

134,140

63,800353,198

22,748375,946

116,466(Notes) 1. The “Other” business segment is not included in reportable segments. “Other” includes businesses such as“Leisure business,” “Asset Management business,” and “Overseas businesses.”
2. “Revenue from other sources” includes leasing income in accordance with ASBJ Statement No. 13,“Accounting Standard for Lease Transactions,” and real estate sales in accordance with the Accounting
System Committee Report No. 15, “Practical Guidelines for Accounting for Transferees in Securitization ofReal Estate Using Special Purpose Companies.”
2. Fundamental information for understanding revenues from contracts with customers
The fundamental information for understanding revenues from contracts with customers is as described in “(6) Basis for
Recognition of Significant Revenue and Expense, in ‘4. Matters regarding accounting policies’ of Notes (Significant
matters that serve as the basis for preparing consolidated financial statements).”
3. Information regarding the relationship between the satisfaction of performance obligations under contracts withcustomers and cash flows arising from such contracts, and the amount and timing of revenue expected to be recognizedin the following consolidated fiscal year or later from contracts with customers that existed at the end of the current
consolidated fiscal year.
(1) Balance of contract assets and contract liabilities
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Balance at the beginning of period(January 1, 2022)
Receivables arising from contracts
with customers
Contract assets
Contract liabilities

Balance at the end of period(December 31, 2022)

8,739

9,827

250

138

21,21527,034

The receivables arising from contracts with customers consist of trade accounts receivable and trade notes
receivable that are unconditional rights to payment as of the end of the consolidated fiscal year.
The contract assets correspond to the Group’s rights to the consideration for work that has created assets controlled
by the customer at the end of the consolidated fiscal year but has not yet been invoiced. Contract assets aretransferred to receivables when the right to payment becomes unconditional.
Contract liabilities relate to the consideration received or receivable by the Group from customers for the Group’s
obligation to transfer goods or services to customers and primarily consist of deposits received or receivable from
customers for condominiums at the end of the consolidated fiscal year.
Revenue recognized during the current consolidated fiscal year that was included in the contract liability balance atthe beginning of the period amounted to ¥8,360 million.

128

FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Balance at the beginning of period

Balance at the end of period(January 1, 2023)(December 31, 2023)

Receivables arising from contracts

9,827

with customers
Contract assets
Contract liabilities

9,859

138

50

27,03437,586

The receivables arising from contracts with customers consist of trade accounts receivable and trade notes
receivable that are unconditional rights to payment as of the end of the consolidated fiscal year.
The contract assets correspond to the Group's rights to the consideration for work that has created assets controlled
by the customer at the end of the consolidated fiscal year but has not yet been invoiced. Contract assets aretransferred to receivables when the right to payment becomes unconditional.
Contract liabilities relate to the consideration received or receivable by the Group from customers for the Group's
obligation to transfer goods or services to customers and primarily consist of deposits received or receivable from
customers for condominiums at the end of the consolidated fiscal year.
Revenue recognized during the current consolidated fiscal year that was included in the contract liability balance atthe beginning of the period amounted to ¥9,375 million.
(2) Transaction prices allocated to remaining performance obligations
At the end of the previous consolidated fiscal year, transaction prices allocated to unfulfilled (or partially fulfilled)
performance obligations by the Group amounted to ¥123,933 million, mainly related to real estate sales in the
Residential business and are generally expected to be recognized as revenue within three years from the end of theconsolidated fiscal year.
At the end of the current consolidated fiscal year, transaction prices allocated to unfulfilled (or partially fulfilled)
performance obligations by the Group amounted to ¥55,884 million, mainly related to real estate sales in the
Residential business and are generally expected to be recognized as revenue within three years from the end of theconsolidated fiscal year.
In making notes, the practical expedient method is applied, and contracts with initially expected contract periods of
one year or less and contracts for which revenue from the fulfillment of performance obligations is recognized inaccordance with Paragraph 19 of the Implementation Guidance are not included.
(Segment information, etc.)
Segment information
1. Overview of reportable segments
The Company’s reportable segments are the Company’s constituent units for which separate financial information isavailable and for which the Board of Directors conducts a regular review to determine the allocation of management
resources and assess the business performance.
The Company has established business divisions according to the nature of its business, and each division formulates
comprehensive strategies for the businesses it handles and develops business activities.
Therefore, the Company comprises business segments with the divisions as the basis and conducts the three (3)businesses of Commercial Properties Business, Residential Business, and Asset Service Business as its reportablesegments.
In the Commercial Properties business, operations include developing, selling, leasing, operating, and managing officebuildings, commercial facilities, logistics properties, etc. In the Residential business, operations include developing,subdividing, selling, leasing, and managing condominiums and other residential properties. In the Asset Service
business, operations include real estate sales, brokerage, consulting and parking lot development and operations.
2. Method of accounting for operating revenue, profit (loss), assets, and other items by reportable segment
The accounting method for reportable business segments is the same as that described in “Notes (Significant mattersthat serve as the basis for preparing consolidated financial statements).” Inter-segment revenues and transfers are basedon prevailing market prices.

129

3. Information on operating revenue, profit (loss), assets and other items by reportable segment
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Reportable segments
Commercial
Residential
Properties
Business
Business

Asset
ServiceBusiness

Total

Other
Business(Note)1

Total

Per
consolidated
Adjustment
financial(Note)2
statements(Note) 3

Operating revenue
External customers

145,155

131,390

50,240326,786

23,154349,940－

349,940

Inter-segment transactions

1,606

330

558

2,495

256

2,752

(2,752)－

Total

146,761

131,72150,799329,282

23,410352,693(2,752)349,940

Operating profit

40,91023,304

7,399

71,615

2,518

74,133(9,655)64,478

Share of profit (loss) of entities
accounted for using equity
method

293

－

－

293

1,532

1,825

－

1,825

Total

41,20423,304

7,399

71,9084,050

75,959(9,655)66,304

1,142,724

269,870

85,9991,498,594

99,806

1,598,401

121,733

1,720,134

13,651

1,514

2,363

17,528

1,042

18,571

225

18,796

1,525

－

－

1,525

41,12642,652－42,652

23,307

1,357

1,519

26,184635

26,81974

26,893

Segment profit

Segment assets
Other items
Depreciation
Investments in entities
accounted for using equity
methodIncrease in property, plant andequipment andintangible assets(Notes) 1. The “Other” business segment is not included in reportable segments. “Other” includes businesses such as “Leisurebusiness,” “Asset Management business,” and “Overseas businesses.”
2. (1) Adjustment of ¥(9,655) million for segment profit includes inter-segment elimination of ¥34 million and corporate
expenses of ¥(9,689) million that are not distributed to the reportable segments. Corporate expenses are primarily
general and administrative expenses that do not belong to the reportable segments.
(2) Adjustment of segment assets of ¥121,733 million includes the company-level assets of ¥205,259 million and intersegment elimination of ¥(83,526) million. The company-level assets chiefly consist of the Company’s cash, deposits,
investment securities and assets relating to corporate divisions.
3. Segment profit is adjusted with the sum of operating profit and share of profit (loss) of entities accounted for using equity
method in the consolidated statement of income.

130

FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Reportable segments
Commercial
Residential
Properties
Business
Business

Asset
ServiceBusiness

Total

Other
Business(Note)1

Total

Per
consolidated
Adjustment
financial(Note)2
statements(Note) 3

Operating revenue
External customers

155,256

134,140

63,800353,198

22,748375,946－

375,946

Inter-segment transactions

1,021

383

1,791

3,197

138

3,335

(3,335)－

Total

156,278

134,524

65,592356,395

22,886379,282(3,335)375,946

Operating profit

38,48327,155

12,90778,5462,204

80,750(10,242)

70,508

Share of profit (loss) of entities
accounted for using equity
method

1,670

(6)

－

1,664

2,256

3,920

－

3,920

Total

40,15327,14912,90780,2104,460

84,670(10,242)

74,4281,210,526

298,805

87,764

1,597,096

126,056

1,723,152

182,156

1,905,309

14,933

1,805

2,508

19,248996

20,244213

20,457

1,653

－

－

1,653

26,26627,920－27,92040,710884

1,307

42,902

2,522

45,42586

45,512

Segment profit

Segment assets
Other items
Depreciation
Investments in entities
accounted for using equity
methodIncrease in property, plant andequipment andintangible assets(Notes) 1. The “Other” business segment is not included in reportable segments. “Other” includes businesses such as “Leisurebusiness,” “Asset Management business,” and “Overseas businesses.”
2. (1) Adjustment of ¥(10,242) million for segment profit includes inter-segment elimination of ¥72 million and corporate
expenses of ¥(10,314) million that are not distributed to the reportable segments. Corporate expenses are primarily
general and administrative expenses that do not belong to the reportable segments.
(2) Adjustment of segment assets of ¥182,156 million includes the company-level assets of ¥272,891 million and intersegment elimination of ¥(90,734) million. The company-level assets chiefly consist of the Company’s cash, deposits
and investment securities and assets. relating to corporate divisions.
3. Segment profit is adjusted with the sum of operating profit and share of profit (loss) of entities accounted for using equity
method in the consolidated statement of income.

131

Related information
FY2022 (January 1, 2022 to December 31, 2022)
1. Information by Product and Service
Information by product and service is omitted as similar information is stated in “3. Information on Operating Revenue,
Profit (Loss), Assets and Other Items by Reportable Segment” in “Segment Information.”
2. Information by Region(1) Operating revenue
Operating revenue is omitted because the amount of operating revenue to external customers in Japan exceeded 90%of the amount of operating revenue stated in the consolidated statement of income.
(2) Property, plant and equipment
Property, plant and equipment are omitted because the amount of property, plant and equipment located in Japanexceeded 90% of the amount of property, plant and equipment stated in the consolidated balance sheet.
3. Information by Major Customer
Information by major customer is omitted because the amount of operating revenue to specified customers, which isincluded in operating revenue to external customers, is less than 10% of the operating revenue stated in the
consolidated statement of income.
FY2023 (January 1, 2023 to December 31, 2023)
1. Information by Product and Service
Information by product and service is omitted as similar information is stated in “3. Information on Operating Revenue,
Profit (Loss), Assets and Other Items by Reportable Segment” in “Segment Information.”
2. Information by Region(1) Operating revenue
Operating revenue is omitted because the amount of operating revenue to external customers in Japan exceeded 90%of the amount of operating revenue stated in the consolidated statement of income.
(2) Property, plant and equipment
Property, plant and equipment are omitted because the amount of property, plant and equipment located in Japanexceeded 90% of the amount of property, plant and equipment stated in the consolidated balance sheet.
3. Information by Major Customer
Information by major customer is omitted because the amount of operating revenue to specified customers, which isincluded in operating revenue to external customers, is less than 10% of the operating revenue stated in the
consolidated statement of income.

132

Information on Impairment Losses of Non-Current Assets by Reportable Segment
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Reportable segments
Commercial
Properties Residential
Business
Business(Note)
Impairment losses

1,772

Asset
ServiceBusiness

Total

320

－

2,093

Other
Business

141

Total

2,234

Per
Reconciling consolidated
items
financialstatements
－

2,234

(Note) Includes ¥1,772 million recorded as loss on building reconstruction.
FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Reportable segments
Commercial
Residential
Properties
Business
Business
Impairment losses

－

Asset
ServiceBusiness

Total

157

－

157

Other
Business

－

Total

157

Per
Reconciling consolidated
items
financialstatements
157－

Information on Amortization of Goodwill and the Balance of Unamortized Goodwill by Reportable Segment
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Reportable segments
Commercial
Residential
Properties
Business
Business
Amortization during
periodBalance at end of
periodAsset
ServiceBusiness

Total

Other
Business

Total

Per
Reconciling consolidated
items
financialstatements

221

62

33

317

－

317

－

317

1,511

205

－

1,716

－

1,716

－

1,716

FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Reportable segments
Commercial
Residential
Properties
Business
Business
Amortization during
periodBalance at end of
periodAsset
ServiceBusiness

Total

Other
Business

Total

Per
Reconciling consolidated
items
financialstatements

177

51

－

229

－

229

－

229

1,333

153

－

1,486

－

1,486

－

1,486

Information on Gain on Bargain Purchase by Reportable Segment
FY2022 (January 1, 2022 to December 31, 2022)
A gain on bargain purchase of ¥870 million was recognized in the Commercial Properties business. The gain on bargain
purchase was recognized because the acquisition cost of Kasumigaseki Building No. 7 PFI Co., Ltd. was less than the net
asset value at the time of the business merger when Kasumigaseki Building No. 7 PFI Co., Ltd. was consolidated.
FY2023 (January 1, 2023 to December 31, 2023)
Not applicable.

133

Information on related parties
FY2022 (January 1, 2022 to December 31, 2022)
Not applicable.
FY2023 (January 1, 2023 to December 31, 2023)
Not applicable.
(Per Share Information)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)
Net assets per share

FY2023(Jan. 1, 2023 to Dec. 31, 2023)¥2,135.08¥2,378.61¥206.15¥215.82

Basic earnings (loss) per share(Note) 1. Diluted earnings per share is not shown because there are no potential dilutive shares.
2. In the calculation of net assets per share and basic earnings per share, the shares of the Company held by the
Board Benefit Trust (BBT) are included in the treasury shares deducted in the calculation of the total number ofshares outstanding at the end of the period and the average number of shares during the period. The number ofshares outstanding at the end of the period of the concerned treasury shares deducted in the calculation of thetotal number of shares outstanding at the end of the period was 241,000 shares for FY2022 and 225,000 sharesfor FY2023, and the average number of shares during the period of the concerned treasury shares deducted in
the calculation of the average number of shares during the period was 241,000 shares for FY2022 and 229,000
shares for FY2023.
3. The calculation basis for basic earnings per share is as shown below.
FY2022

FY2023(Jan. 1, 2022
to Dec. 31, 2022)(Jan. 1, 2023
to Dec. 31, 2023)

Profit attributable to owners of parent (Millions of yen)

43,06245,084

Amount not belonging to the holders of common shares(Millions of yen)－－

43,06245,084

208,890

208,900

Basic earnings (loss) per share

Profit attributable to owners of parent that pertain to commonshares(Millions of yen)
Average number of common shares during the period(Thousands of shares)
4. The calculation basis for net assets per share is as shown below.

End of FY2022

End of FY2023(December 31, 2022)(December 31, 2023)

Total net assets (Millions of yen)

456,838

508,035

Amount of deduction from total net assets (Millions of yen)

10,843

11,135

10,843

11,135445,994496,900

208,889

208,903

Item[Non-controlling interests included in the above (Millions of yen)]
Net assets at the end of the period that pertain to common shares(Millions of yen)
Number of common shares at the end of the period, which were used
for the calculation of net assets per share (Thousands of shares)(Major Subsequent Events)
Not applicable.

134

(v) Consolidated supplementary schedules
Schedule of corporate bonds

Company nameTokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.
Tokyo
TatemonoCo., Ltd.

Balance atBalance at end
beginning ofInterestof period
Redemption
Collateral
Issue dateperiodrate
Remarks(Millions of
date(Millions of
(%)
yen)
yen)

Issuer name23rd Unsecured bondMay 6,
2016

10,00010,0000.63

None

May 1,
2026

24th Unsecured bondSeptember
1,
2016

10,00010,0000.82

None

September 1,
2031

25th Unsecured bondMarch 22,2017

10,00010,0000.52

NoneMarch 19,2027

26th Unsecured bondMay 1,
2017

10,00010,000(10,000)

0.40

None

May 1,
2024

27th Unsecured bondAugust 30,
2017

10,00010,0000.80

NoneAugust 30,
2032

10,000(10,000)

－

0.20

None

February 22,
2023

10,00010,0000.48

None

February 22,2028

15,00015,0001.08

None

February 22,
2038

February22,
2018
February22,
2018
February22,
2018

28th Unsecured bond29th Unsecured bond30th Unsecured bond
1st Hybrid bondMarch 15,201930,00030,0001.66

None

March 15,2056

2nd Hybrid bond(Green bond)March 15,201950,00050,0002.15

None

March 15,2059

31st Unsecured bond
(Sustainability bond)July 16,2020

20,00020,0000.22

NoneJuly 16,2025

32nd Unsecured bond
(Sustainability bond)July 16,2020

20,00020,0000.50

NoneJuly 16,2030

3rd Hybrid bond
(Sustainability bond)February10,
2021

40,00040,0001.13

None

February 10,
2061

33rd Unsecured bond
(Sustainability bond)July 30,2021

10,00010,0000.29

NoneJuly 28,2028

34th Unsecured bond
(Sustainability bond)July 6,2023－

20,0000.88

NoneJuly 6,2033

255,000
265,000－－－(10,000)(10,000)(Notes) 1. Of the balance at the end of the current fiscal year, those scheduled to be redeemed within one year are shown inparentheses.
2. Estimated total redemption amount per year within 5 years from the consolidated balance sheet date is as follows.
(Millions of yen)
Total

－

－

Over twoOver one year
Within one
years andand within two
year
within three
years
years
Bonds payable

10,00020,000135

10,000Over three
years andwithin four
years

Over four
years andwithin fiveyears

10,00020,000Schedule of borrowings, etc.

Category

Balance atBalance at end of
beginning of period
period(Millions of yen) (Millions of yen)

Short-term borrowings
Current portion of long-termborrowings
Current portion of non-recourse longterm borrowings
Current portion of lease liabilities
Long-term borrowings (excludingloans to be settled within one year)
Non-recourse long-term borrowings(excluding loans to be settled within
one year)Lease liabilities (excluding leaseliabilities to be repaid within one year)

Average interest
rate
(%)

Due date

107

106

0.50

－

48,81953,407

0.54

－

3,120

3,240

0.51

－

130

126

－

－

501,890589,833

0.70

January 2025
to December 2043

128,629

125,389

0.51

January 2029
to March 2030

1,950

1,606

－

March 2025
to February 2048

50,00050,000

0.17

－

202

202

0.69

－

2,028

1,825

0.69

September
2033

736,879825,739－－

Other interest-bearing debt
Commercial papers
Accounts payable – other (due within
one year)Long-term accounts payable – other(excluding current portion of long term accounts payable)
Total(Notes) 1. The average interest rate is the weighted average of the interest rate at the end of the current period over the balanceat the end of the current period.
2. The average interest rate for lease liabilities is not stated since consolidated subsidiaries that record lease liabilities on
the consolidated balance sheet at amounts prior to deducting the amount equivalent to interest included in the totallease payments are included.
3. Lease liabilities due within one year are included in “other” current liabilities on the consolidated balance sheet, andlease liabilities due after one year are included in “other” non-current liabilities.
4. Long-term accounts payable – other in other interest-bearing debt are included in “other” non-current liabilities in the
consolidated balance sheet.
5. The amounts of long-term accounts payable – other, non-recourse long-term borrowings, lease liabilities, and longterm accounts payable – other (excluding current portion of long-term accounts payable) due within five years from theconsolidated balance sheet date are as follows.
(Millions of yen)Over one year and Over two years andwithin two years within three years

Over three years
and within four
years

Over four years andwithin five years

Long-term borrowings

77,69966,40678,231

94,217

Non-recourse long-termborrowings

3,240

3,240

3,240

3,240

Lease liabilities

105

103

1,385

6

Long-term accounts payable– other

202

202

202

202

Schedule of asset retirement obligations
Disclosure is omitted as the value of asset retirement obligations at the beginning and end of the current consolidated fiscal
year is no more than one-hundredth of the total liabilities and net assets at the beginning and end of the current consolidated
fiscal year, respectively.

136

(2) Other
Quarter information, etc. in the current consolidated fiscal year
(Cumulative period)

1st Quarter

2nd Quarter

3rd Quarter

Current
consolidated FY

Operating revenue(Millions ofyen)

118,393

179,670

238,199375,946

Profit before income taxes(Millions ofyen)

27,44836,32043,886

68,411

Profit attributable to owners ofparent(Millions ofyen)

17,75523,81629,08545,084

Basic earnings (loss) per share

(yen)

85.00

114.01139.23215.82(Accounting period)
Basic earnings (loss) per share

1st Quarter
(yen)

85.00

2nd Quarter
29.01

3rd Quarter
25.22

4th Quarter
76.58(Note) The Company has introduced a Board Benefit Trust (BBT), and the Company shares held by the trust, which are recorded astreasury shares in shareholders’ equity, are included in treasury shares as a deduction in the calculation of the average numberof shares outstanding during the period for the purpose of calculating basic earnings per share for the period.

137

2. Non-Consolidated Financial Statements(1) Non-Consolidated Financial Statements(i) Non-Consolidated Balance Sheet(Millions of yen)
End of FY2022(December 31, 2022)
AssetsCurrent assets
Cash and deposits
Trade accounts receivable
Investments in leases
Real estate for sale
Real estate for sale in process
Real estate for development
Advance payments to suppliers
Prepaid expenses
Short-term loans receivable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings
Structures
Machinery and equipment
VehiclesTools, furniture and fixtures
Land
Leased assets
Construction in progress
Other, net
Total property, plant and equipment
Intangible assets
Leasehold interests in land
Other
Total intangible assets
Investments and other assets
Investment securities
Shares and Investments in capital ofsubsidiaries and associates
Investments in other securities of subsidiaries
and associates
Investments in silent partnerships
Investments in silent partnerships ofsubsidiaries and associates
Long-term loans receivable from subsidiaries
and associates
Leasehold and guarantee deposits
Other
Allowance for doubtful accounts
Allowance for investment loss
Total investments and other assets
Total non-current assets
Total assets

End of FY2023(December 31, 2023)

58,954
7,499
3,568
117,096*2 159,806
80,8991,227
2,555
24,19027,465(68)
483,195

96,9178,354
3,509*2 173,490*2 151,586
100,479
2,340
2,562
22,356
37,111(33)
598,675*1, *2 136,762*1, *2 132,938*2 2,364*2 2,219*2 997*2 1,08492*2 1,427*1, *2 512,726
1
44,084
2,429
700,887*1, *2 504,687

7*6 88,435

2,432
733,235

39,26240
39,30336,87041
36,911*1 94,395*1 120,520

84,226

79,09914,66913,673

1,242

1,213

60,11359,34324,32630,680*2 11,957

11,82928,465(72)(738)
344,016
1,114,162
1,712,838

30,012(77)(738)
320,126
1,060,317
1,543,513

138

116*2 1,313

(Millions of yen)
End of FY2022(December 31, 2022)
Liabilities
Current liabilities
Short-term borrowings
Commercial papers
Current portion of bonds payable
Lease liabilities
Accounts payable - otherAccrued expenses
Income taxes payable
Contract liabilities
Advances received
Deposits received
Provision for bonuses
Provision for environmental measures
Deposits received under real estate specified joint
enterprise law
OtherTotal current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Lease liabilities
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Provision for retirement benefits
Provision for share-based remuneration for
directors (and other officers)
Provision for loss on guarantees
Leasehold and guarantee deposits received
Deposits received under real estate specified joint
enterprise law
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Legal capital surplus
Other capital surplus
Total capital surplus
Retained earnings
Other retained earnings
Reserve for tax purpose reduction entry of
replacement assets
Reserve for tax purpose reduction topromote open innovation
Retained earnings brought forward
Total retained earnings
Treasury shares
Total shareholders’ equity
Valuation and translation adjustments
Valuation difference on available-for-sale securities
Revaluation reserve for land
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

139

End of FY2023(December 31, 2023)

74,57550,00010,00012*1 9,423
11,565
1,206
24,2573,504
14,130299
082,88750,00010,00014*1 11,103
10,863
13,446
34,597
4,103
11,694317－－*２ 11,300*1 1,257*1 2,326

200,232

242,655

245,000
504,12920
13,64927,274
8,283

255,000
590,02912
17,14527,274
8,270

259

282

3,293

4,210

*1 72,541*1 72,873*2 21,684*2 10,447

2,338

2,343

*1 19,097*1 21,432

917,573
1,117,805

1,009,324
1,251,979

92,451

92,451

63,729063,72963,729063,729

5,802

5,786

75

75

175,850
181,728(448)
337,461

193,073
198,935(425)
354,691

45,05943,187
88,247425,708
1,543,513

62,98043,187106,168
460,859
1,712,838

(ii) Non-Consolidated Statement of Income(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

104,627
111,318
1,437
217,383

114,882
113,285
1,477
229,645

68,412
76,2081,621
146,242
71,141*2 23,178
47,96280,48774,002
1,567
156,057
73,588*2 23,852
49,735

5,265
－
414
5,680

7,869
4
233
8,106

5,369
629
－

6,636
752
105

94

87

0
39
6,133
47,509

－
1,024
8,606
49,235

Operating revenue
Revenue from commercial properties
Revenue from residential business
Revenue from other businessTotal operating revenue
Operating costs
Cost of commercial properties
Cost of residential business
Cost of other businessTotal operating cost
Operating gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest and dividend income
Reversal of allowance for doubtful accounts
Other
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing fee
Bond issuance costs
Dividends paid on real estate specified joint enterpriselaw
Provision for allowance for doubtful accounts
Other
Total non-operating expenses
Ordinary profit

140

(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

630
50
－

226
－
736

－

2,190

681

3,153

9
62
22
547
50
738
1,065
－
2,495
45,694
10,2803,390
13,671
32,023

－
59
－
－
－
－
916
*3 3,712
4,688
47,70019,708(4,272)
15,43632,264Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Gain on sale of shares of subsidiaries and associates
Gain on sale of investments in capital of subsidiaries
and associates
Total extraordinary income
Extraordinary losses
Loss on sale of non-current assets
Loss on retirement of non-current assets
Impairment losses
Loss on building reconstruction
Loss on valuation of investment securities
Provision for allowance for investment loss
Provision for loss on guarantees
Loss on dissolution of joint venture
Total extraordinary losses
Profit before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
Profit141

Operating Statement of Cost(a) Statement of cost of commercial properties business

CategoryNotenumber

FY2022(Jan. 1, 2022 to Dec. 31, 2022)
Composition
Amountratio(Millions of yen)(%)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)
Composition
Amountratio(Millions of yen)(%)

Cost of real estate sales*1

21,39831.3

30,021

37.3

Personnel expenses

*2

4,207

6.1

4,766

5.9

42,80562.6

45,70056.8

Expenses, etc.
Taxes and dues

(5,888)(7,331)

Land and building rent

(10,125)(8,867)

Maintenance expenses(1,805)(1,987)

Utilities(4,437)(4,751)

Administrative expenses(7,732)(7,785)(10,228)(11,484)

Depreciation andamortization

*3

*4

Total
*1
*2
*3
*4

68,412100.0

80,487

100.0

Cost of real estate sales is the direct cost of real estate sales and includes land costs, construction costs andincidental expenses. Costs are calculated on job-order cost system.
Personnel expenses include legal welfare expenses.
Taxes and dues mainly consist of property taxes.
Depreciation and amortization includes depreciation and amortization of real estate for sale under lease.

(b) Statement of cost of residential business

CategoryNotenumber

FY2022(Jan. 1, 2022 to Dec. 31, 2022)
Composition
Amountratio(Millions of yen)(%)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)
Composition
Amountratio(Millions of yen)(%)

Cost of real estate sales*1

71,76994.2

69,704

94.2

Personnel expenses

*2

263

0.3

283

0.4

Expenses, etc.

4,175

5.5

4,014

5.4

Land and building rent

(1,787)(1,802)Administrative expenses

(336)

(362)

(926)

(1,096)

Depreciation andamortization
Total
*1

*2
*3

*3

76,208100.0

74,002

100.0

Cost of real estate sales is the direct cost of real estate sales, including land costs, construction and development
costs, and incidental expenses. The cost is calculated based on job-order cost system. Further, cost of real estate
sales includes book value devaluation of real estate held for sale of ¥1,251 million in the previous fiscal yearand ¥33 million in the current fiscal year.
Personnel expenses include legal welfare expenses.
Depreciation and amortization includes depreciation and amortization of real estate for sale under lease.

142

(c) Statement of cost of other business
FY2022(Jan. 1, 2022 to Dec. 31, 2022)
Composition
Amountratio(Millions of yen)(%)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)
Composition
Amountratio(Millions of yen)
(%)

706

43.5

707

45.1

Expenses, etc.

915

56.5

859

54.9

Land and building rent

(174)

(175)

Depreciation andamortization

(261)

(267)

Category
Personnel expenses

Note
number
*

Total

1,621

*Personnel expenses include legal welfare expenses.

143

100.0

1,567

100.0

(iii) Non-Consolidated Statement of Changes in Equity
FY2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Shareholders’ equity
Capital surplus

Retained earnings
Other retained earnings

SharecapitalBalance at beginning of period

92,451Legalcapitalsurplus

OthercapitalsurplusTotal
capitalsurplus63,729063,729Reserve
Reservefor tax
for tax
purposepurposereduction reduction
entry oftoreplacepromote
ment
open
assetsinnovation
5,817

75

Total

Retainedearnings
brought
forwardTotal
retainedearnings

Treasuryshareholders’sharesequity163,751

169,644(443)

325,381

Dividends of surplus(11,711)(11,711)(11,711)

Profit32,02332,02332,023(8,228)(8,228)(8,228)15－－

Changes during period

Reversal of revaluation reserve
for land
Reversal of reserve for tax
purpose reduction entry of
replacement assets(15)

Purchase of treasury shares
Disposal of treasury shares

0

0

(4)

(4)

0

0

Net changes in items
other than shareholders’ equity
Total changes during period
Balance at end of period

－

－

0

0

(15)

－

12,09912,083(4)

12,07992,451

63,729063,7295,802

75

175,850

181,728(448)

337,461

Valuation and translation adjustments
Valuation difference
Revaluation reserve foron available-for-salelandsecurities
Balance at beginning of period

46,61434,959Total valuation andtranslation
adjustments
81,574

Total net assets

406,956

Changes during period
Dividends of surplus(11,711)

Profit32,023

Reversal of revaluation reserve
for land
Reversal of reserve for tax
purpose reduction entry of
replacement assets(8,228)－Purchase of treasury shares(4)

Disposal of treasury shares0

Net changes in items
other than shareholders’ equity(1,555)

8,228

6,673

6,673

Total changes during period(1,555)

8,228

6,673

18,752

Balance at end of period

45,05943,187

88,247425,708

144

FY2023 (January 1, 2023 to December 31, 2023)(Millions of yen)
Shareholders’ equity
Capital surplus

Retained earnings
Other retained earnings
Reservefor tax
purposereduction
entry ofreplacement assets

Reservefor tax
purposereductiontopromoteopen
innovationRetainedearnings
brought
forward

5,802

75

175,850

181,728

Dividends of surplus(15,057)(15,057)(15,057)

Profit32,26432,26432,264

15

－

－

Share
capitalBalance at beginning of period

92,451Legalcapitalsurplus63,729Other
capitalsurplusTotal
capitalsurplus063,729Total
retainedearnings

TreasurysharesTotalshareholders’equity(448)

337,461

Changes during period

Reversal of reserve for tax
purpose reduction entry of
replacement assets(15)

Purchase of treasury shares
Disposal of treasury shares

0

0

(3)

(3)

26

26

Net changes in items
other than shareholders’ equity
Total changes during period
Balance at end of period

－

－

0

0

(15)

－

17,222

17,20722

17,22992,451

63,729063,7295,786

75

193,073

198,935(425)

354,691

Valuation and translation adjustments
Valuation difference
Revaluation reserve foron available-for-salelandsecurities
Balance at beginning of period

45,05943,187

Total valuation andtranslation
adjustments
88,247

Total net assets

425,708

Changes during period
Dividends of surplus(15,057)

Profit32,264

Reversal of reserve for tax
purpose reduction entry of
replacement assets－

Purchase of treasury shares(3)

Disposal of treasury shares

26

Net changes in items
other than shareholders’ equity

17,921－

17,921

17,921

Total changes during period

17,921－

17,92135,150

Balance at end of period

62,98043,187106,168

460,859

145

Notes(Significant accounting polices)
1. Valuation criteria and valuation method for material assets(1) Valuation criteria and valuation method for securities(i) Held-to-maturity debt securities
Amortized cost method (straight-line method)(ii) Stocks of subsidiaries and affiliates
Cost method based on the moving average method(iii) Available-for-sale securities
Stocks and securities other than non-marketable equity securities, etc.
Fair value method (Unrealized gains and losses are included directly in net assets, and the cost of securities sold isdetermined by the moving average method.)
Non-marketable equity securities, etc.
Cost method based on the moving average method(2) Valuation criteria and valuation method inventories(i) Real estate for sale: Specific Identification Inventory Valuation Method (The book value is written off due to a
decline in profitability.)(ii) Real estate for sale in process: Same as above(iii) Real estate for development: Same as above
2. Depreciation method of non-current assets(1) Property, plant and equipment (excluding lease assets)(i) Buildings: Straight-line method(ii) Structures: Same as above(iii) Machinery and equipment: Same as above(iv) Vehicles: Declining-balance method(v) Tools, furniture and fixtures: same as above(2) Intangible assets (excluding leased assets)
Straight-line method
Software for internal use is amortized by the straight-line method based on the usable period in the Company (5 years).
(3) Leased assets(i) Leased assets related to finance lease transactions that transfer ownership
Depreciation is computed by the same method as that applied to non-current assets owned by the Company.
(ii) Leased assets related to non-ownership-transfer lease transactions
Depreciated using the straight-line method regarding the lease period as the useful life and assuming the residual
value as zero.

146

3. Recording criteria for allowances(1) Allowance for doubtful accounts
To prepare for losses due to bad debts, the Company reports the expected non-collectible amount using the loan loss
ratio for general claims and individually examines the collectability of claims with a possibility of default andbankruptcy or reorganization claims. In the event that an allowance for doubtful accounts has been established for theentire amount of claims in bankruptcy, reorganization, or other similar claims, the allowance for doubtful accounts isdirectly deducted from the claims. As of the end of the previous fiscal year and the end of the current fiscal year, theamount of receivables that fall under this criterion was ¥2,698 million.
(2) Allowance for investment loss
To provide for possible losses on investments in subsidiaries, the Company records an amount deemed necessary,taking into consideration the financial position and expected future recovery of such investments.
(3) Provision for bonuses
Accrued bonuses to employees are provided for the portion of estimated bonuses to be paid in the current fiscal year.
(4) Reserve for retirement benefits
To provide for the payment of retirement benefits to employees, the Company accrues an estimated amount of
retirement benefit obligations and plan assets at the end of the current fiscal year. Actuarial gains and losses ofretirement benefits are amortized from the following fiscal year using the straight-line method over a fixed number ofyears (10 years) within the employee’s average remaining years of service.
(5) Provision for share-based remuneration for directors (and other officers)
To provide for the payment of the Company’s shares to the Directors and Audit & Supervisory Board Members inaccordance with the Company’s “Regulations of Directors’ Equity Benefit,” the Company records an amount based on
the estimated amount of liabilities for share benefits as of the end of the current fiscal year.
(6) Provision for loss on guarantees
Accrued losses on guarantees are provided for based on the actual financial condition of the principal debtor.
(7) Provision for environmental measures
To provide for expenditures for the disposal of polychlorinated biphenyls (PCBs) and other wastes, the Company
records an amount reasonably estimated to be required.
4. Basis for recognition of revenue and expense(1) Accounting Standard for Revenue Recognition
The main performance obligations in the Company’s main businesses related to revenues arising from contracts withcustomers and the usual point in time at which such performance obligations are satisfied (the usual point in time atwhich revenues are recognized) are as follows.
In the Commercial Properties business, the Company mainly develops, sells, leases, and operates office buildings,
commercial facilities, and logistics facilities and has obligations to deliver real estate based on contracts withcustomers, to lease real estate, and to provide services stipulated in the contracts with customers.
In the Residential business, the Company mainly develops, subdivides, sells, leases, and operates condominiums, etc.,
and is obligated to deliver real estate based on contracts with customers, lease real estate, and provide services
stipulated in contracts with customers.
Of these performance obligations, the delivery obligation is satisfied at the time the property is delivered to thecustomer, and revenue is recognized at the time of delivery. The transaction price is determined based on the amount in
the contract with the customer and is received at the time stipulated in the contract. With respect to sales ofcondominiums and other properties, a deposit is usually received as part of the transaction price at the time the contract
is concluded, and the balance is received at the time of delivery of the property.
Conversely, obligations to provide services and other items stipulated in the contract with customers are fulfilled at apoint in time or over a certain period of time, depending on the nature of the service, whereby the Company records
revenues. Transaction values are determined by consignment contracts with customers and are received based on said
contracts.
For obligations to lease real estate based on contracts with customers, etc., revenue is recorded in accordance with the“Accounting Standard for Lease Transactions” (ASBJ Statement No. 13; March 30, 2007).
In relation to the above performance obligations, no significant financial component is included in the amount ofcompensation.
Furthermore, no significant variable consideration is recognized that could cause the amount of consideration to vary.
(2) Recognition of revenues from finance lease transactions
Sales and cost of sales are recognized at the time of receipt of lease payments.

147

5. Other matters that serve as the basis for preparing non-consolidated financial statements(1) Treatment of deferred assets
Bond issuance costs
The entire amount is expensed at the time of expenditure.
(2) Hedge accounting method(i) Hedge accounting method
Interest rate swaps that meet the requirements for special treatment are accounted for using the special treatment,
while other interest rate swaps are accounted for using the deferred hedge method.
(ii) Hedging instruments and hedged items
Hedging instrument: Interest rate swaps
Hedged items: Borrowings(iii) Hedging policy
The Company enters into interest rate swaps to hedge the impact of interest rate fluctuations on earnings and does
not enter into such swaps for speculative purposes.
(iv) Method of assessing hedge effectiveness
During the period from the inception of the hedge to the point at which its effectiveness is assessed, the Company
compares the cumulative changes in cash flows of the hedging instrument with the cumulative changes in cash
flows of the hedged item to determine its effectiveness. However, the effectiveness of interest rate swaps for which
special treatment is applied is not assessed.
(3) Accounting for Retirement Benefits
The accounting method for unrecognized actuarial gains and losses and unrecognized past service costs related toretirement benefits differs from the method used in the consolidated financial statements.

148

(Significant accounting estimates)
1. Valuation of non-current assets(1) Amount recorded in the financial statements for the current fiscal year
(Millions of yen)
FY2022
FY2023
Property, plant and equipment
700,887
733,235
Intangible assets
39,30336,911－
Impairment losses (Note)
569(Note) The previous fiscal year includes ¥547 million recorded as loss on building reconstruction.
(2) Matters related to significant accounting estimates for identified items
The calculation method of the amount of (1) is the same as that described in “1. Valuation of non-current assets” in“(1) Notes to Consolidated Financial Statements (Significant accounting estimates)” of “1. Consolidated Financial
Statements.”
2. Valuation of inventories(1) Amount recorded in the financial statements for the current fiscal year
(Millions of yen)
FY2023
173,490
151,586
100,479
33

FY2022
Real estate for sale
117,096
Real estate for sale in process
159,806
Real estate for development
80,899Loss on valuation of inventory
1,251(2) Matters related to significant accounting estimates for identified items
The calculation method of the amount of (1) is the same as that described in “2. Valuation of inventories” in “(1)Notes to Consolidated Financial Statements (Significant accounting estimates)” of “1. Consolidated Financial
Statements .”3. Valuation of shares and investments in capital of subsidiaries and associates(1) Amount recorded in the financial statements for the current fiscal year
FY2022
Shares and Investments in capital of
84,226
subsidiaries and associates
Allowance for investment loss (Non(738)current assets)
Allowance for investment loss
738
(Extraordinary loss)(2) Matters related to significant accounting estimates for identified items(i) Method of calculation of the amount stated above under (1)(Millions of yen)
FY202379,099(738)－

Shares and investments in subsidiaries and associates are stated at cost on the balance sheet. When the actual valueof such shares and investments in subsidiaries and affiliates declines significantly due to deterioration in therelevant company’s financial condition, a corresponding reduction in value is made, and the valuation difference isrecognized as a loss for the period.
Further, when the actual value has not yet reached a situation where it has declined significantly but has declined
to some extent, an amount equivalent to the decline is recorded in the allowance for investment loss.
(ii) Key assumptions used in significant accounting estimates
The key assumptions used in the calculation of the actual value are those used in the valuation of the real estate
held by each project company, which are described in “3. Valuation of investments in overseas entities accounted
for using equity method,” “(1) Notes to Consolidated Financial Statements (Significant accounting estimates)” of“1. Consolidated Financial Statements.”(iii) Effect of significant accounting estimates on the financial statements for the fiscal year following the current fiscal
year
In valuing stocks and investments in subsidiaries and associates, the best estimates are made based on the key
assumptions mentioned above in (ii). In the event of changes in the business environment or other factors that alter
the assumptions used above, losses may need to be recognized in the following fiscal year or later.

149

4. Provision for loss on guarantees for loans of Yangon Museum Development Pte. Ltd. (below, “YMD”)(1) Amount recorded in the financial statements for the current fiscal year
(Millions of yen)
FY2022

FY2023

Total amount of debt guarantees

6,688

6,535

Provision for loss on guarantees (Liabilities)
Provision for loss on guarantees

3,293

4,210

1,065
(Extraordinary loss)(2) Matters related to significant accounting estimates for identified items

916

(i)

Method of calculation of the amount stated above under (1).

The Company guarantees the borrowings of YMD, an entity accounted for using equity method. The Company
estimates the amount of losses to be borne by YMD based on the valuation of fixed non-current assets held by Y
Complex Co., Ltd. (“YC”), an entity accounted for using equity method of the Company, in which YMD has a
stake, taking into consideration YMD’s financial position, and posts an amount equivalent to the Company’s shareof YMD’s excess liabilities as a provision for loss on guarantees.
(ii) Key assumptions used in significant accounting estimates
The key assumptions used in the calculation of the amount of losses are those used in the valuation of the noncurrent assets held by YC, which are described in “3. Valuation of investments in overseas entities accounted forusing equity method,” “(1) Notes to Consolidated Financial Statements (Significant accounting estimates)” of “1.
Consolidated Financial Statements.”(iii) Effect of significant accounting estimates on the financial statements for the fiscal year following the current fiscal
year
Provision for loss on guarantees is based on the best estimate based on the key assumptions described in (ii) above.
In the event of changes in the business environment or other changes in the assumptions and other factors
described above, additional provisions may be required in the following fiscal year or later.
(Changes in accounting policies)(Application of Implementation Guidance on Accounting Standard for Fair Value Measurement, etc. policies)
We have applied the “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance No.
31; June 17, 2021; below, “Implementation Guidance on Accounting Standard for Fair Value Measurement”) from the
beginning of the current fiscal year, and we will apply the new accounting policy stipulated by the Implementation Guidanceon Accounting Standard for Fair Value Measurement prospectively in accordance with the transitional treatment prescribedin Paragraph 27-2 of the Implementation Guidance on Accounting Standard for Fair Value Measurement.
The impact of the application of the Accounting Standard for Fair Value Measurement on the financial statements for thecurrent fiscal year is immaterial.
(Additional Information)(Board Benefit Trust (BBT))
For the purpose of raising awareness of the need to contribute to medium- and long-term growth in corporate value, theCompany has introduced a stock compensation plan, the “Board Benefit Trust (BBT),” for Directors (excl. External
Directors) and Managing Officers who do not concurrently serve as Directors of the Company (hereinafter collectively
referred to as “Directors, etc.”). For details, please refer to “(1) Notes to Consolidated Financial Statements (Additional
Information)” of “1. Consolidated Financial Statements.”

150

(Matters related to the balance sheet)*1. Assets pledged as collateral and liabilities related to collateral are as follows.
Assets pledged as collateral(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

Buildings

4,948

4,626

Land

19,166

19,166

Total

24,11523,792

Liabilities related to collateral(Millions of yen)
FY2022(December 31, 2022)

FY2023(December 31, 2023)

Accounts payable - other

202

202

Other (Current liabilities)
Leasehold and guarantee deposits received

16
126

16
109

Other (Non-current liabilities)

2,028

1,825

Total

2,374

2,154

Other than the above, ¥305 million of investment securities were pledged as collateral for guarantees of borrowingsof funds by affiliated companies in the previous and current fiscal years, respectively.
*2. Relevant real estate, etc. outlined in the real estate specified joint enterprise law (silent partnership method) is asfollows.
(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

Real estate for sale
Real estate for sale in process－
10,307

8,488
7,620

Buildings, etc.
Land

1,132
2,826

1,064
2,826

Leasehold and guarantee deposits
Total

40

－

14,30720,000The corresponding investment received is recorded in “deposits received under real estate specified joint enterprise
law.”

151

3. Guarantee liabilities and related values are as follows.
(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

4,481

768

affiliated companies
Yangon Museum Development Pte. Ltd.

3,394

2,324

Raimon Land Twenty Six Co., Ltd.
Raimon Land Sathorn Co., Ltd.

340
2,021

－
－

11,479

－

23
4

14
4

302
30

1,757
30

22,0774,900

Liable for guarantees on loans to its
customers
Liable for guarantees on loans to overseas

PT Dharma Tatemono Property
PT Dharma Tatemono Residences(Note)

Liable for guarantees on loans totransactions with affiliated companies
E-State Online Co., Ltd.
Nihon Parking Corporation
Liable for guarantees on loans to business
partner
Maekawa Inc.
Setoda Resort Co., Ltd.
Total
(Note) Indicates the total amount of joint guarantees.
4. Contingent liabilities related to debt assumption contract for bonds
Debt performance for the following bonds has been delegated based on a trust-type debt assumption agreement (debtassumption agreement) for the bonds with a financial institution. Accordingly, the Company’s obligation to redeem thebonds to the bondholders will continue to exist until the bonds are redeemed, notwithstanding the offsetting eliminationof the debt related to the bonds and the amount payable under said agreement.
(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

18th Unsecured bond

15,000－Total

15,000－5. Monetary receivables and payables to subsidiaries and affiliates (excluding those presented separately) are as follows.
(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)

Short-term monetary receivables
Long-term monetary receivables

27,271
2,309

26,601
2,202

Short-term monetary payables
Long-term monetary payables

30,381
4,815

32,053
5,608*6 Reduction entry amount deducted from the acquisition cost for non-current assets due to the conversion of rights inconnection with a Type 1 Urban Redevelopment Project under the Urban Renewal Act is as follows.
(Millions of yen)
FY2022

FY2023(December 31, 2022)(December 31, 2023)－

17,164

Construction in progress152

(Matters related to the statement of income)1. Transactions with subsidiaries and affiliates are as follows.
(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

Transactions related to operating revenue
Transactions related to operating expenses

12,803
16,434

14,031
14,650Non-operating transactions

2,343

3,846

*2. Selling expenses accounted for 55.9% and 54.3% in the previous and current fiscal years, respectively, and general andadministrative expenses accounted for 44.1% and 45.7% in the previous and current fiscal years, respectively.
Major items and figures of selling, general and administrative expenses are as follows.
(Millions of yen)
FY2022(Jan. 1, 2022 to Dec. 31, 2022)

FY2023(Jan. 1, 2023 to Dec. 31, 2023)

Advertising expenses
Sale Miscellaneous expenses

3,492
3,006

3,577
2,324

Salaries
Taxes and dues

4,900
3,551

5,060
2,953

*3 Loss on dissolution of joint venture
The loss on dissolution of joint venture is related to the termination of the joint venture agreements with the joint venture
partners due to the conversion of PT Dharma Tatemono Property and PT Dharma Tatemono Residences into subsidiaries.
(Matters related to securities)
Shares of subsidiaries and associates
FY2022 (December 31, 2022)
The fair values of shares of subsidiaries and associates are not stated as they do not have market prices.
FY2023 (December 31, 2023)
The fair values of shares of subsidiaries and associates are not stated as they do not have market prices.
(Note) Book value of non-marketable equity securities and other securities on the balance sheet(Millions of yen)
Category

FY2022(December 31, 2022)

Shares of subsidiaries
Shares of associates
Total

153

FY2023(December 31, 2023)

57,331

61,39547

47

57,37961,443

(Matters related to tax effect accounting)
1. Breakdown of deferred tax assets and deferred tax liabilities by major cause(Millions of yen)
FY2022(December 31, 2022)

FY2023(December 31, 2023)

2,534
8,209

2,530
8,162

822

665

5,817

5,621

870

857

2,066

1,983

Deferred tax assets
Provision for retirement benefits
Impairment losses
Loss on valuation of real estate for sale
Loss on valuation of shares ofsubsidiaries and associates, etc.
Excess allowance for doubtful accounts
Unrealized gains (losses) on
distributions from silent partnerships
Compensation income
Provision for loss on guarantees

704

1,964

1,007
1,366

1,288
1,880

3,946

7,931

27,345(17,644)

32,887(18,880)

9,700

14,006(19,424)(27,192)(2,558)(2,551)(1,367)(1,408)

Total deferred tax liabilities(23,350)(31,152)

Net deferred tax assets (liabilities)(13,649)(17,145)

Depreciation of real estate for sale
Other
Subtotal of deferred tax assets
Valuation allowance
Total deferred tax assets
Deferred tax liabilities
Valuation difference on available-forsale securities
Reserve for tax purpose reduction entryof replacement assets
Other(Change in presentation method)
The “depreciation of real estate for sale,” which was included in “Other” in the previous fiscal year, is presented as aseparate line item in the current fiscal year due to its increased materiality. On the other hand, the “Loss on valuation of
investment securities,” which was separately presented in the previous fiscal year, is included in “Other” in the current
fiscal year due to its decreased materiality. The notes for the previous fiscal year have been reclassified to reflect thischange in presentation.
2. Breakdown by major cause when there is a significant difference between statutory tax rate and effective tax rate
FY2022(December 31, 2022)
Statutory tax rate
(Adjustment)
Increase (decrease) in valuation allowanceEntertainment expense(s) and other items not
permanently deductible for income tax purposes
Dividends income and other items not
permanently includable in income
Foreign withholding tax
Foreign tax credit
Other

FY2023(December 31, 2023)

－

30.6%

－

2.6

－

2.8

－

(3.4)

－
－
－

0.6
(0.4)
(0.4)

－
Effective tax rate
32.4
(Note) In the previous fiscal year, the difference between the statutory tax rate and the effective tax rate after theapplication of tax effect accounting was less than 5% of the statutory tax rate; thus, notes are omitted.

154

(Revenue-recognition related)
Notes have been omitted as information that forms the basis for understanding revenue from contracts with customers is
identical to “(1) Notes to Consolidated Financial Statements (Revenue-recognition)” of “1. Consolidated Financial
Statements.”(Major Subsequent Events)
Not applicable.

155

(iv) Supplementary schedules
Schedule of property, plant and equipment(Millions of yen)
Category

Asset type

Decrease in Depreciation Book value,
Accumulated
the current in the current the end ofdepreciation
year
year
periodBuildings

136,762

5,337

589

8,570

132,938

117,214Structures

2,364

87

2

230

2,219

7,911

Machinery andequipment

997

220

0

134

1,084

2,824

Vehicles

92

65

0

41

116

812

1,427

393

1

505

1,313

4,736

512,726[61,102]

16,31424,354[5,190]－504,687[55,911]

－

1

7

－

1

7

4

Construction in progress

44,084[9,360]44,847[5,190]495－

88,435[14,551]－

Other property, plantand equipment

2,429

3

－

－

2,432

－

Total

700,887

67,27725,444

9,485

733,235

133,503

Leasehold interests inland

39,262

0

2,392

－

36,870

－

40

3

－

2

41

344

39,303

3

2,392

2

36,911

344

Tools, furniture andProperty, plant and fixtures
equipment
Land
Leased assets

Intangible assets

Book value, Increase in
the beginning the currentof period
year

Other
Total

(Notes) 1. Figures in [ ] in the “Book value, the beginning of period,” “Increase in the current year,” “Decrease in the current year,”and “Book value, the end of period” columns represent the difference between the book value of the land before
revaluation conducted in accordance with the Order for Enforcement of the Act on Revaluation of Land (1998, Law No.
34). The increase in the current year and decrease in the current year are due to transfers between accounts in connection
with the conversion of rights in the Type 1 Urban Area Redevelopment Project.
2. Major items in “Increase in the current year” are as follows
Transfer in connection with the rights exchange procedures andConstruction inparticipating committee members’ contributions, etc. in the Yaesu 1¥32,643 million
progresschome North District Category 1 Urban Redevelopment Project
Participating committee members’ contributions, etc. in Type-1 Urban
Construction in
Redevelopment Project for Yaesu 1-Chome East Area in Front of Tokyo¥7,699 million
progress
Station (District B)
3. Major items in “Decrease in the current year” are as follows
Transferred to construction in progress in connection with the rights
Land
exchange procedures in the Yaesu 1-chome North District Category 1¥23,920 million
Urban Redevelopment Project156

Schedule of allowances(Millions of yen)
Category

Balance at beginningof period

Increase in thecurrent year

Decrease in thecurrent year

Balance at end of
periodAllowance for doubtful accounts

145

65

106

105

Allowance for investment loss

738

－

－

738

Provision for bonuses

299

317

299

317

Provision for share-based
remuneration for directors (andother officers)

259

86

63

282

Provision for loss on guarantees

3,293

916

－

4,210

0

－

0

－

Provision for environmental
measures(2) Major assets and liabilities

Statement is omitted as the Company prepared the consolidated financial statements.
(3) Other
Not applicable.

157

VI. Stock-Related Administration for the Company

Fiscal year
Ordinary General Meeting of
Shareholders

From January 1 to December 31
To be held in March

Record date

December 31

Record date for distribution

Interim dividend: June 30

of surplus

Year-end dividend: December 31

Number of sharesconstituting one unit

100 shares

Purchase and sale of sharesof less than one unit
Office for handlingbusiness(Special account)
1-3-3, Marunouchi, Chiyoda-ku, Tokyo
Head Office Transfer Agent Department
Mizuho Trust & Banking Co., Ltd.

Transfer agent(Special account)
1-3-3, Marunouchi, Chiyoda-ku, Tokyo
Mizuho Trust & Banking Co., Ltd.

Forwarding office―Handling charge for

Separately determined amount equivalent to commissions related to brokerage of stock

purchase and saletransactions
The Company carries out its public notifications by means of electronic public notice.
However, in the event that it is not possible to provide electronic public notice due to an

Method of Public Notice

accident or other unavoidable reason, public notice shall be provided in the Nihon Keizai
Shimbun published in Tokyo. Electronic public notices are posted on the Company's website,
and the URL is as follows.
https://www.tatemono.com/ir/

Special benefit forshareholders

None(Notes) 1. Fees may not be charged in the event of a reverse stock split or a split of share certificates into trading units.
2. The Company’s Articles of Incorporation stipulate that shareholders of the Company may not exercise any rights otherthan the following rights with respect to their shares constituting less than one unit.
(1) Rights stipulated in each item of Paragraph 2, Article 189 of the Companies Act.
(2) The right to make a request pursuant to the provisions of Article 166, Paragraph 1 of the Companies Act.
(3) Right to receive an allotment of offered shares and offered stock acquisition rights in proportion to the number ofshares held by the shareholder.
(4) Right to request the sale of the number of shares that, together with the number of shares of less than one unit heldby the shareholder, will constitute one unit of shares.

158VII. Reference Information on the Company
1. Information on the Parent Company
The Company has no parent company.

2. Other Reference Information
The Company filed the following documents during the period from the commencing date of the current fiscal year to the filingdate of the Annual Securities Report.
(1) Annual Securities Report and the attachments thereto, and Confirmation Letter
Fiscal Year (205th Fiscal Year) (From January 1, 2022 to December 31, 2022)

March 29, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau(2) Internal Control Report and the attachments thereto
March 29, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau(3) Quarterly Report and Confirmation Letter
1st quarter of 206th Fiscal Year (from January 1, 2023 to March 31, 2023)

May 12, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau

2nd quarter of 206th Fiscal Year (from April 1, 2023 to June 30, 2023)

August 10, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau

3rd quarter of 206th Fiscal Year (from July 1, 2023 to September 30, 2023)

November 10, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau(4) Amended Shelf Registration Statement (Bonds)
April 3, 2023
October 12, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau(5) Supplement to Shelf Registration Statement (Bonds) and attachments thereto
June 30, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau(6) Extraordinary Report
This is an extraordinary report pursuant to the provisions of Article 19, Paragraph 2, Item
9-2 (Results of the Exercise of Voting Rights at the General Meeting of Shareholders)of the Cabinet Office Order on Disclosure of Corporate Affairs.

April 3, 2023
Filed with the DirectorGeneral of Kanto Local
Finance Bureau

159

This is an extraordinary report pursuant to the provisions of Article 19, Paragraph 2, Item
3 (Changes in Specified Subsidiaries)

October 12, 2023
Filed with the Director-of the Cabinet Office Ordinance on the Disclosure of Corporate Affairs, etc.

General of Kanto Local
Finance Bureau

160

Part II: Information on Guarantors, etc. for the Company
Not applicable.

161

(For Translation Purposes Only)
Independent Auditor’s Report

March 27, 2024
The Board of Directors
Tokyo Tatemono Co., Ltd.:

Ernst & Young ShinNihon LLC.
Tokyo, Japan
Designated andEngagement Partner
Managing Partner

CertifiedPublicAccountant

Yuji Mukaide

Designated andEngagement Partner
Managing Partner

CertifiedPublicAccountant

Koji Ojima<Audit of Financial Statements>
OpinionIn order to provide audit certification pursuant to Paragraph 1 of Article 193-2 of the Financial Instruments and Exchange Act, wehave audited the consolidated financial statements of Tokyo Tatemono Co., Ltd. for the fiscal year (from January 1, 2023 to
December 31, 2023), provided in the “Financial Information,” which comprises the consolidated balance sheet, consolidated
statement of income, consolidated statement of comprehensive income, consolidated statement of changes in equity, andconsolidated statement of cash flows, significant matters that serve as the basis for preparing consolidated financial statements, othernotes, and consolidated supplementary schedules.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position ofTokyo Tatemono Co., Ltd. and its consolidated subsidiaries as of December 31, 2023, as well as its consolidated financial
performance and consolidated cash flows for the year then ended in accordance with accounting principles generally accepted inJapan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards
are further described in the Auditor’s Responsibilities for the audit of the consolidated financial statements section of our report. We
are independent of the Company and its consolidated subsidiaries in accordance with the requirements for professional ethics inJapan, and we have fulfilled our other ethical responsibilities as Auditors. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are matters that, in our professional judgment, were of most significance in our audit of the consolidated financial
statements of the current consolidated fiscal year. These matters were addressed in the context of our audit of the consolidated
financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

162

Recognition of revenue from real estate sales transactions (excluding housing sales)
Description of Key Audit Matter

Auditor’s Response

Tokyo Tatemono Co., Ltd. (the “Company”) and its

We mainly performed the following procedures for real estate

consolidated subsidiaries engage in real estate sales transactions. sales transactions (excluding housing sales) to test for the risk that
Revenue from real estate sales transactions is included in “Real revenue is inappropriately recognized.
estate sales” (38,643 million yen in Commercial Properties,
104,693 million yen in Residential, and 25,248 million yen in

・In order to consider transactions as a whole, the attributes oftransaction counterparties, and whether there is continued

Asset Service) that is part of “1. Information that disaggregatesrevenue from contracts with customers” under “Revenue-

involvement in real estate after it is sold, as well as the details ofsuch involvement, we inspected sales contracts, requests forrecognition” in the notes to the consolidated financial statements
for the fiscal year ended December 31, 2023.

approval, minutes of meetings of the board of directors, andexternal information such as websites and the like.

Generally, real estate sales transactions (excluding housing
・In order to test transaction amounts, we compared suchsales) are highly individual in nature and the transaction amounts amounts with peripheral transactions and real estate appraisals.
are large. Such transactions involve the risk that revenue isinappropriately recognized, despite substantially all the risks and・In inspecting real estate appraisals, we compared the future
cash flows underlying such real estate appraisals with publicly

rewards of ownership having not been transferred, due to theCompany and its consolidated subsidiaries continuing to beavailable market information and earnings from the real estateholding period. Further, we compared discount rates with publicly

involved with the real estate through, for example, entrustment of available peripheral cases.
management after the sale of real estate and provision of・In order to consider the impact of whether there is continued
substantial guarantees of future cash flows from the transferred
involvement in real estate after it is sold, as well as the details of
real estate.
such involvement, on the transfer of the risks and rewards ofAccordingly, we have determined that real estate sales
transactions (excluding housing sales) represent a key audit

ownership, we inspected sale contracts and other related contracts
and made inquiries of management and the relevant divisions.

matter.

・In order to test the facts of transactions, we inspectedsupporting documents related to cash receipts and the company
register.

163

Valuation of real estate for sale in process received as a result of the termination of the Indonesia business joint venture
Description of Key Audit Matter

Auditor’s Response

As described in the notes to the consolidated statement of

We mainly performed the following procedures in considering

income in the notes to the consolidated financial statements, in the the valuation of in-development real estate for sale in processfiscal year ended December 31, 2023, the Company terminated its received in consolidation.
joint venture agreement with its partner in the joint venture to・In order to obtain an understanding of the project, we inspected
restructure the Dharmawangsa Project (tentative name), a project requests for approval, minutes of meetings of the board of
to develop condominiums and offices and sell them as individual
units in Jakarta, Indonesia.

directors, and the project business plan and made inquiries ofmanagement and managers of overseas business divisions. In

As a result of the Company repaying external borrowings that it addition, we performed on-site inspections and made inquiries ofand the joint venture partner were required to repay in connection management of the Project Companies and local project managers.
with the Dharmawangsa Project companies (hereinafter, the“Project Companies”), thus creating a loan receivable from thejoint venture partner, and the Company accepting shares of the
Project Companies held by the joint venture partner as a partial

・In order to consider the expected amount of sales in the projectbusiness plan, we compared the sales amount with external
information regarding sales transaction results for similar

substitution for this loan receivable, the Company recorded loss on properties and with materials related to test marketing conducted
termination of joint venture agreement of 3,712 million yen in its by the Company and inspected market environment analysis
consolidated statement of income for the fiscal year ended
December 31, 2023.

reports published by external organizations.
In addition, we performed trend analysis of sales transaction

Loss on termination of joint venture agreement is calculated as results for similar properties and compared the results with thethe difference between the total of the existing equity in Project
outcome of reviews from prior years in which we involved
Companies and the equity accepted as a substitution for the loan
receivable from the joint venture partner and the assets acquired

specialists from EY network firms.
・In order to consider the amount of construction costs expected

and liabilities assumed that are recorded on the consolidatedbalance sheet. In-development real estate for sale in process

to arise in the future in the project business plan, we madeinquiries of management and heads of relevant divisions regarding

constitutes a significant proportion of the assets acquired andliabilities assumed.

the status of negotiations conducted to conclude construction
contracts and inspected underlying estimates and cost breakdowns

The valuation of in-development real estate for sale in process is from contractors.
based on the business plan for the project. This business plan
In addition, we performed trend analysis of construction costs inincludes significant assumptions, namely, the expected amount of price reports obtained from real estate appraisal firms andsales and the amount of construction costs expected to arise in the inspected market environment analysis reports published by
future, and these assumptions involve significant future
external organizations.
uncertainty as well as management subjectivity in the selection and ・In order to assess whether future uncertainty was evaluated byapplication of accounting estimations.
Accordingly, we have determined that the valuation of in-management and reflected in accounting estimates, weconsidered management’s evaluation of uncertainty regarding

development real estate for sale in process received inconsolidation due to the termination of the joint venture

the expected amount of sales and the amount of construction
costs expected to arise in the future that incorporated a certain

agreement is a key audit matter.

level of risk from the market environment.

Other Information
Other information consists of that included in the Annual Securities Report, other than the consolidated financial statements, thefinancial statements and our Auditor’s reports thereon. Management is responsible for the preparation and disclosure of the otherinformation. The Audit & Supervisory Board members and the Audit & Supervisory Board are responsible for overseeing theexecution of duties by the Directors in designing and operating the reporting process of the other information.
Our opinion on the consolidated financial statements does not cover the other information, and we do not express any form ofassurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doingso, consider whether the other information is materially inconsistent with the consolidated financial statements, or our knowledge
obtained in the audit or otherwise appears to be materially misstated.

164

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required
to report that fact.
We have nothing to report in this regard.
Responsibilities of Management, Audit & Supervisory Board Members and the Audit & Supervisory Board for the consolidated
financial statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance withaccounting principles generally accepted in Japan. This includes establishing and operating internal control as management
determines is necessary to enable the preparation and fair presentation of the consolidated financial statements that are free frommaterial misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing whether it is appropriate to prepare theconsolidated financial statements on the going concern basis of accounting and responsible for disclosing, as applicable, mattersrelated to going concern in accordance with accounting principles generally accepted in Japan.
Audit & Supervisory Board members and the Audit & Supervisory Board are responsible for overseeing the Directors’ execution ofduties relating to the design and implementation of the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our responsibilities are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free frommaterial misstatement, whether due to fraud or error and to issue an Auditor’s report that includes our opinion from an independent
perspective on the consolidated financial statements. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basisof these consolidated financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:• Identify and assess the risks of material misstatement due to fraud or error; in addition, design and perform audit procedures that
address the risks of material misstatement. The selection and application of audit procedures are at our discretion. Furthermore,
we obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
• In making those risk assessments, we consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances, while the purpose of the audit of the consolidated financial statements is not to express an
opinion on the effectiveness of the Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting to prepare the consolidated
financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty related to the going concern basis of accounting exists, we are required to draw attention in our Auditor’s report to
the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to our Auditor’s report date. However, future events or conditions may
cause the Company to cease to continue as a going concern.
• Evaluate whether the presentation and disclosures in the consolidated financial statements are in accordance with accounting
standards generally accepted in Japan, the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events ina manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the Company and its consolidated subsidiaries
to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performanceof the audit of consolidated financial statements. We remain solely responsible for our audit opinion.
We communicate with the Audit & Supervisory Board members and Audit & Supervisory Board regarding, among other mattersthat are required by auditing standards, the planned scope and timing of the audit, significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide Audit & Supervisory Board members and the Audit & Supervisory Board with a statement that we have compliedwith relevant ethical requirements regarding independence and communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence and, where applicable, if measures have been taken to eliminate inhibiting factors
or safeguards have been applied to reduce inhibiting factors to an acceptable level, the content of such measures or safeguards.
From the matters communicated with Audit & Supervisory Board Members and the Audit & Supervisory Board, we determine those165

matters that were of most significance in the audit of the consolidated financial statements of the current period and are, therefore,
key audit matters. We describe these matters in our Auditor’s report unless law or regulation precludes public disclosure about thematter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because
the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.

166

< Audit of Internal Control>
OpinionIn order to provide audit certification pursuant to the Paragraph 2, Article 193-2 of the Financial Instruments and Exchange Act, wehave audited the management’s report on internal control over financial reporting of Tokyo Tatemono Co., Ltd. as of December 31,
2023.
In our opinion, the management’s report on internal control referred to above, which represents that the internal control over financial
reporting of Tokyo Tatemono Co., Ltd. as of December 31, 2023 is effectively maintained, presents fairly, in all material respects,
the results of management’s assessment of internal control over financial reporting in conformity with standards for assessment ofinternal control over financial reporting generally accepted in Japan.
Basis for Opinion
We conducted our audit of internal control in accordance with auditing standards for internal control over financial reporting
generally accepted in Japan. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for theaudit section of internal control of our report. We are independent of the Company and its consolidated subsidiaries in accordancewith the requirements for professional ethics in Japan, and we have fulfilled our other ethical responsibilities as Auditors. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Responsibilities of Management, Audit & Supervisory Board Members and the Audit & Supervisory Board for the Internal Control
Report
The management is responsible for establishing and operating internal control over financial reporting and preparing and properly
presenting an internal control report in accordance with the evaluation standards for internal control over financial reporting
generally accepted in Japan.
The Audit & Supervisory Board Members and the Audit & Supervisory Board are responsible for monitoring and verifying thedesign and operation of internal control over financial reporting.
Internal control over financial reporting may not completely prevent or detect misstatements in financial reporting.
Auditor’s Responsibilities in the Audit of Internal Control
Our responsibilities are to obtain reasonable assurance about whether the management’s report on internal control is free frommaterial misstatement and to express an opinion from an independent perspective on an internal control report in our audit report ofinternal control.

167

As part of our audit in accordance with auditing standards for internal control over financial reporting generally accepted in Japan,
we exercise professional judgment and maintain professional skepticism throughout the audit. We also:• Conduct audit procedures to obtain audit evidence regarding the results of the evaluation of internal control over financial reportingin the internal control report. Audit procedures for audit of internal control are selected and applied at the Auditor’s discretion
based on the materiality of the effects on the reliability of financial reporting.
• Examine representations on the scope, procedures, and results of assessment of internal control over financial reporting made bymanagement, as well as evaluating the overall presentation of management’s report on internal control.
• Obtain sufficient appropriate audit evidence regarding the results of assessment of internal control over financial reporting in the
management’s report on internal control. We are responsible for direction, supervision and performance of the audit ofmanagement’s report on internal control. We remain solely responsible for our audit opinion.
We communicate with the Audit & Supervisory Board Members and Audit & Supervisory Board regarding the planned scope andtiming of the audit of internal control, results of the audit of internal control, including identified material weaknesses which should
be disclosed, the results of remediation, and other matters that are required by auditing standards for internal control.
We also provide Audit & Supervisory Board members and the Audit & Supervisory Board with a statement that we have compliedwith relevant ethical requirements regarding independence and communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence and, where applicable, if measures have been taken to eliminate inhibiting factors
or safeguards have been applied to reduce inhibiting factors to an acceptable level, the content of such measures or safeguards.
<Compensation-related information>
The amounts of compensation paid to our firm and others in the same network for audit attestation services and non-audit services
for the company and its subsidiaries are as described in “(3) Status of Audits” under “Corporate Governance, etc.” included in“Status of the Company.”
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Group that is required to be disclosed pursuant to
the provisions of the Certified Public Accountants Act of Japan.
End*1 The original of the above Independent Auditor’s Report is kept separately by the Company (the company submitting the annual
securities report).
2 XBRL data is not included in the scope of the audit.

Notes to the Readers of Independent Auditor’s Report
This is an English translation of the Independent Auditor’s Report as required by the Companies Act of Japan for the conveniences of
the reader.

168

(For Translation Purposes Only)
Independent Auditor’s Report

March 27, 2024
The Board of Directors
Tokyo Tatemono Co., Ltd.:
Ernst & Young ShinNihon LLC.
Tokyo, Japan
Designated andEngagement Partner
Managing Partner

CertifiedPublicAccountant

Yuji Mukaide

Designated andEngagement Partner
Managing Partner

CertifiedPublicAccountant

Koji Ojima

OpinionIn order to provide audit certification pursuant to Paragraph 1 Article 193-2 of the Financial Instruments and Exchange Act, we haveaudited Tokyo Tatemono Co., Ltd.’s non-consolidated financial statements for the 206th fiscal year (from January 1, 2023 to
December 31, 2023), provided in the “Financial Information,” which comprises the balance sheet, statement of income, statementof changes in equity, significant accounting policies, other notes, and supplementary schedules.
In our opinion, the accompanying non-consolidated financial statements present fairly, in all material respects, the financial positionof Tokyo Tatemono Co., Ltd. as of December 31, 2023, and its financial performance for the year then ended in accordance withaccounting principles generally accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards
are further described in the Auditor’s Responsibilities for the audit of the financial statements section of our report. We are
independent of the Company in accordance with the requirements for professional ethics that are relevant to our audit of the financial
statements in Japan, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial
statements of the current fiscal year. These matters were addressed in the context of the audit of the financial statements as a wholeand in forming the Auditor’s opinion thereon, and we do not provide a separate opinion on these matters.

169

Valuation of real estate for sale in process that is a significant component of the valuation of shares received as a result of thetermination of the Indonesia business joint venture
Description of Key Audit Matter

Auditor’s Response

As described in the notes to the statement of income in the notes

We mainly performed the following procedures in consideringto the financial statements, in the fiscal year ended December 31, the valuation of in-development real estate for sale in process,2023, Tokyo Tatemono Co., Ltd. (the “Company”) terminated its which is a significant component of the valuation of shares of thejoint venture agreement with its partner in the joint venture to
Project Companies.
restructure the Dharmawangsa Project (tentative name), a project ・In order to obtain an understanding of the project, we inspected
to develop condominiums and offices and sell them as individual requests for approval, minutes of meetings of the board ofunits in Jakarta, Indonesia.
directors, and the project business plan and made inquiries of
As a result of the Company repaying external borrowings that it management and managers of overseas business divisions. In
and the joint venture partner were required to repay in connection addition, we performed on-site inspections and made inquiries ofwith the Dharmawangsa Project companies (hereinafter, the“Project Companies”), thus creating a loan receivable from the

management of the Project Companies and local project managers.
・In order to consider the expected amount of sales in the project

joint venture partner, and the Company accepting shares of the
Project Companies held by the joint venture partner as a partial

business plan, we compared the sales amount with external
information regarding sales transaction results for similar

substitution for this loan receivable, the Company recorded loss on properties and with materials related to test marketing conducted
termination of joint venture agreement of 3,712 million yen in its by the Company and inspected market environment analysis
statement of income for the fiscal year ended December 31, 2023. reports published by external organizations.
Loss on termination of joint venture agreement is calculated as In addition, we performed trend analysis of sales transaction
the difference between the received shares of the Project
results for similar properties and compared the results with theCompanies and the loan receivable. In determining the value of the outcome of reviews from prior years in which we involved
shares of the Project Companies, it is important to determine the specialists from EY network firms.
value of in-development real estate for sale in process held by the ・In order to consider the amount of construction costs expected
Project Companies.
to arise in the future in the project business plan, we madeThe valuation of in-development real estate for sale in process is inquiries of management and heads of relevant divisions regarding
based on the business plan for the project. This business plan
the status of negotiations conducted to conclude construction
includes significant assumptions, namely, the expected amount of contracts and inspected estimates and cost breakdowns fromsales and the amount of construction costs expected to arise in the contractors.
future, and these assumptions involve significant future
In addition, we performed trend analysis of the level of
uncertainty as well as management subjectivity in the selection and construction costs in price reports obtained from real estate
application of accounting estimations.
appraisal firms and inspected market environment analysis reports
published by external organizations.
Accordingly, we have determined that the valuation of indevelopment real estate for sale in process, which is a significant ・In order to assess whether future uncertainty was evaluated bycomponent of the valuation of shares of the Project Companies management and reflected in accounting estimates, we consideredmanagement’s evaluation of uncertainty regarding the expected
received as a result of the termination of the joint ventureagreement, is a key audit matter.

amount of sales and the amount of construction costs expected toarise in the future that incorporated a certain level of risk from themarket environment.

Recognition of revenue from real estate sales transactions (excluding housing sales)
Information has been omitted because it is identical to the key audit matter (recognition of revenue from real estate sales transactions(excluding housing sales)) included in the Auditor’s report on the consolidated financial statements.
Other Information
Other information consists of that included in the Annual Securities Report, other than the consolidated financial statements, thefinancial statements and our Auditor’s reports thereon. Management is responsible for the preparation and disclosure of the otherinformation. The Audit & Supervisory Board members and the Audit & Supervisory Board are responsible for overseeing theexecution of duties by the Directors in designing and operating the reporting process of the other information.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion
thereon.
In the course of our audit of the financial statements, our responsibility is to read through the other statements and, in the course ofreading, to consider whether there are material inconsistencies between the other statements and the financial statements or our170knowledge obtained in the audit, otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact.
We have nothing to report in this regard.

Responsibilities of Management, Audit & Supervisory Board Members and the Audit & Supervisory Board for the Financial
Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting
principles generally accepted in Japan. This includes establishing and operating internal control as management determines isnecessary to enable the preparation and fair presentation of the financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, management is responsible for assessing whether it is appropriate to prepare the financial
statements on the going concern basis of accounting and responsible for disclosing, as applicable, matters related to going concern
in accordance with accounting principles generally accepted in Japan.
Audit & Supervisory Board members and the Audit & Supervisory Board are responsible for overseeing the Directors’ execution ofduties relating to the design and implementation of the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our responsibilities are to obtain reasonable assurance about whether the non-consolidated financial statements as a whole are freefrom material misstatement, whether due to fraud or error and to issue an Auditor’s report that includes our opinion from an
independent perspective on the non-consolidated financial statements. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users takenon the basis of these financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:・ Identify and assess the risks of material misstatement due to fraud or error. In addition, design and perform audit procedures that
address the risks of material misstatement. The selection and application of audit procedures are at our discretion. Furthermore,
we obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
• In making those risk assessments, we consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances, while the objective of the audit of the non-consolidated financial statements is not to express an
opinion on the effectiveness of the Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting to prepare the non-consolidated
financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty
related to the going concern basis of accounting exists, we are required to draw attention in our Auditor’s report to the related
disclosures in the non-consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to our Auditor’s report date. However, future events or conditions may
cause the Company to cease to continue as a going concern.
• Evaluate whether the presentation and disclosures in the non-consolidated financial statements are in accordance with accounting
standards generally accepted in Japan, the overall presentation, structure and content of the non-consolidated financial statements,
including the disclosures, and whether the non-consolidated financial statements represent the underlying transactions and eventsin a manner that achieves fair presentation.
We communicate with the Audit & Supervisory Board members and Audit & Supervisory Board regarding, among other mattersthat are required by auditing standards, the planned scope and timing of the audit, significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide Audit & Supervisory Board members and the Audit & Supervisory Board with a statement that we have compliedwith relevant ethical requirements regarding independence and communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence and, where applicable, if measures have been taken to eliminate inhibiting factors
or safeguards have been applied to reduce inhibiting factors to an acceptable level, the content of such measures or safeguards.
From the matters communicated with Audit & Supervisory Board members and the Audit & Supervisory Board, we determine thosematters that were of most significance in the audit of the financial statements of the current fiscal year and are, therefore, key audit

171matters. We describe these matters in our Auditor’s report unless law or regulation precludes public disclosure about the matter orwhen, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
<Fee-related information>
Compensation-related information stated in the Independent Auditor’s Report for the consolidated financial statements.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Group that is required to be disclosed pursuant to
the provisions of the Certified Public Accountants Act of Japan.
End*1 The original of the above Independent Auditor’s Report is kept separately by the Company (the company submitting the annual
securities report).
2 XBRL data is not included in the scope of the audit.

Notes to the Readers of Independent Auditor’s Report
This is an English translation of the Independent Auditor’s Report as required by the Companies Act of Japan for the conveniences of
the reader.

172

CoverDocument Filed:Internal Control Report

Applicable Law:

Paragraph 1 of Article 24-4-4 of the Financial Instruments and Exchange Act

Filed to:Director-General of Kanto Local Finance Bureau

Filing Date:

March 27, 2024

Company Name:Tokyo Tatemono Kabushiki Kaisha

Company Name in English:

Tokyo Tatemono Co., Ltd.

Name and Title of Representative:

Hitoshi Nomura, Representative Director, President & Chief Executive Officer

Name and Title of Chief Financial Officer:

Akira Izumi, Representative Director, Senior Managing Executive Officer

Location of Head Office:1-9-9 Yaesu, Chuo-ku, Tokyo(The above is the address registered as the location of the head office of theCompany.
Actual business operations are conducted at the following “Nearest place ofcontact.”)
1-4-16 Yaesu, Chuo-ku, Tokyo

Place Where Available for Public Inspection:

Tokyo Tatemono Co., Ltd. Kansai Branch(3-4-8 Honmachi, Chuo-ku, Osaka-shi, Osaka)
Tokyo Stock Exchange, Inc.
(2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)

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1. Matters concerning the basic framework for internal control over financial reporting
Hitoshi Nomura, Representative director, President & Chief Executive Officer, and Akira Izumi, Representative director, Senior
Managing Executive Officer & Chief Financial Officer, are responsible for designing and operating effective internal control
over financial reporting of Tokyo Tatemono Co., Ltd. (“the Company”), and have designed and operated internal control overfinancial reporting in accordance with the basic framework for internal control set forth in “On the Revision of the Standards
and Practice Standards for Management Assessment and Audit concerning Internal Control Over Financial Reporting (Council
Opinions)” published by the Business Accounting Council.
The internal control is designed to achieve its objectives to the extent reasonable through the effective function and combinationof its basic elements. Therefore, there is a possibility that misstatements may not be completely prevented or detected by internal
control over financial reporting.

2. Matters related to the scope of valuation, record date and valuation procedures
We conducted our assessment of internal control over financial reporting with a base date of December 31, 2023, the end of thecurrent fiscal year.
Our assessment followed generally accepted standards for assessing internal control over financial reporting. In conducting thisassessment, we evaluated internal controls that may have a material effect on the entire financial reporting in a consolidation(“company-level controls”) and based on the result of this assessment; we appropriately selected business processes to beevaluated, analyzed these selected business processes, identified key controls that may have a material impact on the reliabilityof our financial reporting, and assessed the design and operation of these key controls. We also evaluated the effectiveness ofinternal control by assessing the related internal control over information technology.
We determined the required scope of assessment of internal control over financial reporting for the Company, as well as its
consolidated subsidiaries and equity-method affiliated companies, from the perspective of the materiality that may affect thereliability of our financial reporting. The materiality that may affect the reliability of the financial reporting is determined,taking into account the materiality of quantitative and qualitative impacts. We confirmed that we had reasonably determined thescope of the assessment of internal controls over business processes considering the results of the assessment of company-level
controls conducted for the Company, its consolidated subsidiaries and equity-method affiliated companies. Consolidated
subsidiaries and equity method affiliates deemed insignificant in terms of monetary and qualitative importance were notincluded in the company-wide internal control evaluation scope.
For the purpose of determining the scope of process-level control assessment, four business locations were selected as“Significant Business Locations,” which comprise the Company and its consolidated subsidiaries selected in descending order
based on their fiscal year’s net sales, and which contributed approximately two-thirds of the Company’s consolidated net sales
in the aggregate. In such Significant Business Locations, all business processes related to the accounts that are closely associatedwith the Company’s business objectives, such as sales, trade and other receivables, and inventories, were included in the scopeof assessment. Furthermore, regardless of the Significant Business Locations, certain business processes related to significant
accounts involving estimates and forecasts were added to the scope of assessment as business processes with the material impactof financial reporting.

3. Matters related to the results of the evaluation
Based on the above evaluation results, we have determined that the Company's internal control over financial reporting iseffective as of the end of the current fiscal year

4. NoteThere is nothing to be added.

5. Special note
There are no special items to be noted upon confirmation.

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CoverDocument Filed:

Confirmation Letter

Applicable Law:

Paragraph 1 of Article 24-4-2 of the Financial Instruments and Exchange Act

Filed to:Director-General of Kanto Local Finance Bureau

Filing Date:

March 27, 2024

Company Name:Tokyo Tatemono Kabushiki Kaisha

Company Name in English:

Tokyo Tatemono Co., Ltd.

Name and Title of Representative:

Hitoshi Nomura, Representative Director, President & Chief Executive Officer

Name and Title of Chief Financial Officer:

Akira Izumi, Representative Director, Senior Managing Executive Officer

Location of Head Office:1-9-9 Yaesu, Chuo-ku, Tokyo(The above is the address registered as the location of the head office of the Company.
Actual business operations are conducted at the following “Nearest place of contact.”)
1-4-16 Yaesu, Chuo-ku, Tokyo

Place Where Available for Public Inspection:

Tokyo Tatemono Co., Ltd. Kansai Branch(3-4-8 Honmachi, Chuo-ku, Osaka-shi, Osaka)
Tokyo Stock Exchange, Inc.
(2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)

1751. Matters concerning the appropriateness of the information in the Annual Securities Report
Hitoshi Nomura, Representative director, President & Chief Executive Officer of the Company, and Akira Izumi, Chief
Financial Officer of the Company, have confirmed that the information in the Annual Securities Report of the Company for the
206th fiscal year (from January 1, 2023 to December 31, 2023) is properly presented in accordance with the Financial
Instruments and Exchange Act.

2. Special note
There are no special items to be noted upon confirmation.

176