FY2022 – 1Q

(For the Year Ending March 31, 2022)

IR Presentation

For details of the "Long-Term Management Plan 2030", which began from April 2020, please refer to the following link.
https://www.mec.co.jp/j/investor/plan/pdf/plan200124.pdf

Contents
Summary of Financial Statements

3

Summary of FY2022-1Q Results

4

Summary of FY2022 Estimates

7

Progress of Long-Term Management Plan

10

Financial Supplemental Data

19

Overview of the "Long-Term Management Plan 2030"

27

Business Overview

37

Commercial Property Business
Office Building

40

Outlet Malls, Retail Properties, Logistics Facilities, Hotels, and Airports

54

Residential Business

59

International Business

65

Other Business

68

Investment/Financial Data, etc.

70

ESG Initiatives

75

MITSUBISHI ESTATE CO., LTD.

2

Summary of Financial Statements

Summary of Financial Statements＜FY2022-1Q Financial Results＞•

Revenues and operating income increased on a YoY basis, mainly due to an increase in capital gains, etc.

•

Retail properties and hotel business were affected by the third emergency declaration, but revenues improved YoY.

＜FY2022 Estimates＞•

No change from the forecast announced on May 13, 2021.

＜Major Topics＞•

Entered biomass power generation business in Higashimatsuyama City, Saitama Prefecture (May 2021)•" TOKYO TORCH Tokiwabashi Tower" completed (June 2021)•

Participated in "Oasis Central Sudirman," a large-scale multi-use development project in Jakarta (June 2021)•

Commenced the project to reconstruct "Yurakucho Building" and "Shin-Yurakucho Building" (July 2021)•

Name of "Fukaya Hanazono Premium Outlet" decided and construction began (July 2021)

MITSUBISHI ESTATE CO., LTD.

3

Summary of FY2022-1Q Results

MITSUBISHI ESTATE CO., LTD.

4

Summary of FY2022-1Q Results

1. Income Statement Results for FY2022-1Q
Revenues and operating income increased on a YoY basis, mainly due to an increase in capital gains<New Segment>
Revenue from Operations
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other*
Elimination
Operating Income
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other*1
Eliminations or corporate
Non-Operating Revenue(of affiliates' equity in earnings)
Non-Operating Expense

Millions of yen (rounded down)

FY2022-1Q FY2021-1Q
307,402257,481
206,490
168,030
66,62858,39521,36819,414
5,549
5,449
13,62812,497△ 6,262△ 6,305
62,56354,22856,82653,598
2,979
270
8,268
7,192
1,357
1,404
△ 1,313△ 2,153△ 5,555△ 6,083
5,516
4,951
118
99
10,131
7,848
Income before Taxes and Special Items
57,94851,331
Extraordinary Income
2,221
Extraordinary Loss
2,495
5,698
Profit Attributable to Owners of Parent
34,70829,263

Change49,921
38,460
8,233
1,954
99
1,130
42
8,335
3,228
2,709
1,075
△ 46
840
528
564
19
2,283
6,616
2,221
△ 3,202
5,445

Millions of yen (rounded off

Capital Gains included in Operating Income
to the nearest billion)
FY2022-1Q FY2021-1Q Change
Total
20,00010,00030,000Commercial Property Business
17,0006,000
23,000Residential Business
3,000
2,000
5,000
International Business
2,000
0
2,000
Investment Management Business
Other
Eliminations or corporate-

Major Factors for Changes in
Operating Income by Business
Commercial
Property
3,228

Business profits
EBITDA
Interest-bearing debt

MITSUBISHI ESTATE CO., LTD.

Others
1,322

62,563

Increase in capital gains

54,228

Increase in capital gains
Reversal of extraordinary loss (COVID-19)*2
in retail properties and hotels

Change8,354
10,855
214,051*1Architectural Design & Engineering / Real Estate Service Business and Other businesses

International
1,075

Increase in capital gains

Millions of yen (rounded down)

FY2022-1Q FY2021-1Q
62,68254,32888,51377,6582,757,002 2,542,951

Residential
2,709

FY2021-1Q

Commercial

Residential

International

Others※2 In the previous fiscal year, a portion of the expenses during the closure was recorded as an extraordinary loss.

FY2022-1Q

Property5

Summary of FY2022-1Q Results

2. Changes in Revenue from Operations by Asset Type (Japan)
Retails and Hotels were affected by the 3rd SOE, but revenue from operations increased YoY
Office buildings※

Retail properties, outlet malls, hotels, etc.

(Billions of yen)(Billions of yen)

70
60.7

60.1

60.4

62.2

61.1

62.5

62.5

61.9

62.1

60

1st

14
12

11.6

11.3

12.0

11.4

11.3

10.1
50

10

40
30.9

31.6

32.7

33.5

33.6

35.1

36.1

35.5

37.0

30
20

10.9

11.9
10.9
9.1

10.3

7.2

7.2
6.4

9.4

8.9

3rd

9.3

8.7

6.2

6
15.6

16.0

16.1

16.8

4.2
14.3

15.1

15.3

14.6

14.8

4
2

20/3
1Q

20/3
2Q

Marunouchi

20/3
3Q

20/3
4Q

21/3
1Q

4.2

5.7
2.3

10
0

8

10.8

2nd

21/3
2Q

Tokyo (excl. Marunouchi)

21/3
3Q

21/3
4Q

22/3
1Q

Outside Tokyo

0

2.3

2.7

0.8

20/3
1Q

20/3
2Q

20/3
3Q

20/3
4Q

21/3
1Q

21/3
2Q

Outlet malls
Others (stand-alone SC, logistics facilities, etc.)
Royal Park Hotels and Resorts

21/3
3Q

21/3
4Q

22/3
1Q

SOE declaration period(Areas and requests differ
each time)※Incl. revenue from office complexes and retail properties

MITSUBISHI ESTATE CO., LTD.

6

Summary of FY2022 Estimates※No change from the forecast announced on May 13, 2021

MITSUBISHI ESTATE CO., LTD.

7

Summary of FY2022 Estimates※No change from theforecast announced on
May 13, 2021.

1. Income Statement Estimates for FY2022 （vs FY2021 Results）

Due to the completion of new buildings and increases in capital gains, operating income isexpected to reach its highest numbers.
Millions of yen (rounded off
Millions of yen (rounded down)

FY2022
FY2021<New Segment>
Estimates
Results
Revenue from Operations
1,326,000 1,207,594
Commercial Property Business
787,000
672,441
Residential Business
373,000
362,755
International Business
96,000114,457
Investment Management Business
23,00022,199*Other
72,00065,119△ 25,000 △ 29,378
Elimination
Operating Income
245,000
224,394
Commercial Property Business
194,000
180,775
Residential Business
24,00024,068International Business
42,00037,932
Investment Management Business
7,000
5,966
*Other2,000△ 130△ 24,000 △ 24,219
Eliminations or corporate
Non-Operating Revenue
11,00026,292(of affiliates' equity in earnings)
300
307
Non-Operating Expense
36,00039,720
Income before Taxes and Special Items
220,000
210,965
Extraordinary Income
15,00016,603Extraordinary Loss
17,00026,304
Profit Attributable to Owners of Parent
142,000
135,655

Change118,406
114,559
10,245△ 18,457
801
6,881
4,378
20,606
13,225
△ 68
4,068
1,034
2,130
219
△ 15,292△7△ 3,720
9,035△ 1,603△ 9,304
6,345

Millions of yen (rounded down)

Business profits
EBITDA
Interest-bearing debt

FY2022
FY2021
Estimates
Results
245,300
224,701
344,000
331,8212,680,000 2,526,142

to the nearest billion)

FY2021Results
51,00032,000
7,000
12,000-Change13,00011,000△ 2,000
4,000-

Major Factors for Changes in
Operating Income by Business
Commercial
Property
13,225Residential International
4,608
△ 68

Others3,383

Increase in capital gains

224,394

ChangeIncrease in condominium profits
Decrease in capital gains

245,000

Increase in capital gains
Completion of new buildings

20,59912,179
153,858*Architectural Design & Engineering / Real Estate Service Business and Other businesses
MITSUBISHI ESTATE CO., LTD.

Capital Gains included in Operating Income
FY2022Estimates
Total
64,000Commercial Property Business
43,000Residential Business
5,000International Business
16,000Investment Management Business
Other
Eliminations or corporate-

FY2021

Commercial

Results

Property

Residential

International

Others

FY2022Estimates

8

Summary of FY2022 Estimates※No change from theannounced on
2. Breakdown of Business Profits for the FY2022 (Changes from FY2020) forecast
May 13, 2021.

Expecting improved profit levels than FY2020 due to improving business environment
and increasing capital gains, etc.
Business
Profits
240.9
Capital Gains

61.0
14.7

Domestic
Condominiums,
etc.*

Business
Profits
224.7【Breakdown】
・Commercial:＋9・Residential: ▲3・International: ▲16

51.0

+2.0

16.7

【Main factors】+Favorable sales trends+Profit margin improvement(Gross margin: 17.8％ → 18.7%)

Business
Profits
245.3
+13.0

▲10.0

(Billions of yen))【Breakdown】
・Commercial: ＋11
・Residential: ▲2・International:＋4

64.0

+4.3

21.0

【Main factors】+Favorable sales trends+Profit margin improvement（Gross margin: 18.7％ → 20.0%)

+3.3

165.2

Income Gains

FY2020 Results▲8.2【Main factors】▲COVID-19 impact＋Increase in building rental profits＋Increase in international rental
profits (US)＋Increase in profits from Asia
condominium business

157.0

Differences

FY2021 Results【Main factors】＋New buildings' contributions＋Business environment
improvement in retail properties
and hotels＋Increase in non-asset profits▲Increase in repair costs▲Decrease in rental profits due tothe sell of properties▲Decrease in profits from buildings
due to redevelopments

Differences

160.3

FY2022 Estimates* Excluding capital gains, etc. from the Mitsubishi Estate Residence's operating income

MITSUBISHI ESTATE CO., LTD.

9

Progress of the Long-Term Management Plan

MITSUBISHI ESTATE CO., LTD.

10

Progress of the Long-Term Management Plan

1. Changes in ROA/ROE/EPS※Re-posting of IR Presentation for FY2021 (disclosed on May 13, 2021)

Although the first fiscal year (FY2021) of the Long-Term Management Plan was impacted by
COVID-19, strategies for the 2030 goal have been steadily executed.
10%

10.0%

200

9.0%
7.8%

7.6%

7.3%

7.0%

7.6%
150

6.6%

5.2%

5.6%

108.6496.97

5.0%

101.34106.70

5%

86.78
74.00

4.0%
52.85
3.0%

200

8.5%

8.0%

6.0%

(Yen)

60.13

3.3%

3.3%

FY2015FY2016

4.0%

3.8%

4.1%

3.8%

100

4.0%

3.6%

50

2.0%
1.0%

FY2017FY2018FY2019EPS(right axis)
MITSUBISHI ESTATE CO., LTD.

FY2020ROA

FY2021ROE

FY2022(E)* ROA = Business

2030 Target

0

Profit / Total assets (average)

11

Progress of the Long-Term Management Plan

2. Domestic Asset Business※Re-posting of IR Presentation for FY2021 (disclosed on May 13, 2021)

Increase NOI with Development Projects: Steady Progress of Large Projects■Expected completion in
FY2022
Tokiwabashi Tower(Bldg. A)■Completion in FY2021
Mizuho Marunouchi
Tower・Ginkokaikan
Marunouchi Terrace■Progress of Long-Term Development Properties
Uchikanda 1-chome Project(tentative name)Toyosu 4-2 Project(tentative name)Torch Tower (Bldg. B)

Sep. 2020:
Announcement of
the zone name
Process to changeplans (increase floorarea ratio by 100%)
FY2024:
Expected started
date of construction

the ARGYLE aoyama＜Expand Outlet malls＞

Sep. 2020: Finalized urban planning
May 2022: Expected start ofconstruction
2025: Expected completion①Gotemba (Phase 4): ＋16,400㎡②Rinku (Phase 5): ＋10,700㎡

Mar. 2021: Project announcement
Spring 2022: Expected start ofconstruction
Spring 2025: Expected completion

FY2028:
Expected completion

Promoting a rotating business model according to the real estate market
Gaining more investment opportunities than previously assumed■Transition of Capital Gains (incl. overseas)■Investments in FY2021

Recording steady capital gains every FY(Billions of yen)
60.0
40.0
20.0
0.0

39.0
15.0
24.0
FY2018

61.0
48.0
14.0
34.0
FY2019Domestic

MITSUBISHI ESTATE CO., LTD.

64.0
51.0

28.0

12.0

33.0

39.0

FY2020

FY2021

Overseas

Obtained investment opportunities mainly for
offices, logistics facilities, and rental apartments(Performance: +40% than expected)

Book value at end of FY2021¥1.2 tn

OfficeRetail16.0
48.0

FY2022(E)■*Domestic Assets

Rentalapartment

8.5%

Logistics

10.3%

Hotel

(Tentative name)
Sagamihara-shi Chuo-ku Fuchinobe project

Composition of Assets
2.3%
8.9%
2.1%

Other

67.8%
*Total income-generating

assets x-Marunouchi,
Outlet malls, and assetsof particular consolidated
subsidiaries

12

Progress of the Long-Term Management Plan

3. International Asset Business※Re-posting of IR Presentation for FY2021 (disclosed on May 13, 2021)

US

EuropeAsia• First to enter the US data center development
project.

• Obtained development opportunities in several
European countries by cooperating with Europa
Capital Group, one of our Group companies.

• Starting FY2021, accelerate the completion progressof properties currently under development.

• TA Realty, a subsidiary of Mitsubishi Estate,
manages the development of the project.
• MEC participates in the development of twobuildings (joint investment with Tokyo Century).
■Overview of Entire Project(Participated in 2 bldgs.):(Tentative name) Fyrkanten11(Stockholm, Office renovation)

Location: Loudoun County, Virginia

Trinity Tower*(Jakarta, FY2021)*Previous project name: Daswin Project

Total Area: 587,000㎡

CapitaSpring（Singapore, FY2022)

Building Area: 140,000㎡ (total of 7 bldgs.)
Total cost: Approx. 198 bn yen
Start of construction: By end of *12021, *22022
Completion: *1May 2023, *2Feb. 2024

Morello(London, Rental apartment)(Tentative name)

Cristóbal de Moura 121-125(Barcelona, Office)*1 Schedule for Building 1, which MEC has participated in

MITSUBISHI ESTATE CO., LTD.

Appearance (Current)

Rooftop Terrace(Image after the renovation)*2 Schedule for Building 2, which MEC has participated in

180 George St.
(Sydney, FY2023)• Participation in a condominium development
project in Australia.

• Started the large renovation project of the
Warwick Court, an office building in London.

*3Completed image of property

Savya Financial CenterNorth Tower (Manila, FY2022)

One Sydney Harbour Residences One (Sydney, Condominium)*3 The actual building could look different from the above.

13

Progress of the Long-Term Management Plan

4. Non-asset Business
Materialize Steady Growth in Existing Businesses■Expand *AuM in the investment management business※Re-posting of IR Presentation for FY2021 (disclosed on May 13, 2021)

New Areas (Utilize technologies/BtoC/BtoBtoC）■Efforts to support various workstyles• Promote managerial efforts to reach a 5 trillion yen of asset
value by mid-2020s.
(As of FY2021: Approx. 3.7 trillion yen, increased by 0.1 trillion
yen vs the previous fiscal year).

TELECUBE(Private smart workspaces)
Expand installation spots
to apartment complexes,
convenience stores, offices,and train stations• Started managing an open-end fund in Europe.
(November 2020)

NINJA SPACE*AuM ＝ Assets Under Management

Helping workers find workspaces atrestaurants, conference rooms, hotels, etc.

■Acquire fee income business through the promotion of joint ventures• Acquire fee income business and improve investment efficiency
by operating as a joint venture from the development stage.
• Release several joint venture projects in FY2021.

■Proactive promotion of pilot programs of new technologies andservices
Self-standing/driving
delivery robot

Pilot program of electricscooters on public roads (Firstin Japan)Fitting/shopping of
D2C brand products
Finding the most optimal
garbage collection route byutilizing AI and quantum
computers

Concept image of joint ventures

MITSUBISHI ESTATE CO., LTD.

(Room for approx. 57% of CO2
reduction was confirmed)

14

Progress of the Long-Term Management Plan

5. Capital Policy #1: Cashflow of FY2022 (Estimates)※Re-posting of IR Presentation for FY2021(disclosed on May 13, 2021)

Increase cash inflow due to recovered profits and increased collections. Expand investment opportunities in orderto achieve goals set in the Long-Term Management Plan.
Cash in
750～800
Soundness level for new investments(Considering possibility to expand investment
opportunities)

Cash out
750～800

Financing arrangements(Increase in liabilities)
130～180

Increase in returns as capital gains increase(+20 compared to previous fiscal year)

Increase in operating cashflows as businessprofits improve(+40 compared to previous fiscal year)*1 Collection amount of book values from sale proceeds of properties*1 Returns

400

Strategic
allocation
100～150

Share buyback
30

Continue plans of seeking strategic
investment opportunities, mainly overseas in
Asia. Consider possibility to expand
investment opportunities.
Execute as a part of the capital policy of theLong-Term Management Plan

Recently, investment opportunities weresteadily gained【Breakdown】*2 Planned

investments
580*3 Operating

cashflows
220(Billions of yen)

Dividends
40

Marunouchi
Outlet Mall, etc.
Domestic condominium
Domestic capital recycling and others
Overseas

60
30
160
190
140

Payout ratio: Approx. 30％
Dividend per share: 33 yen (Recovered to thelevel of FY2020)*2 Investment amount for approved investment projects (partly incl. expected approvals)*3 Operating cashflows, excl. change in inventories and change in equity investments

MITSUBISHI ESTATE CO., LTD.

15

Progress of the Long-Term Management Plan

6. Capital Policy #2: Shareholders Returns ※Re-posting of IR Presentation for FY2021 (disclosed on May 13, 2021)
Decided share buyback of 30 billion yen as a part of the capital policy in the Long-Term Management Plan.
As financial performance recovers, expected dividend payouts during FY2022 will rise to the level of FY2020.
(Yen)

40

45.0%

35

33.00
30.00

30

31.00

33.00

41.0%
39.0%

26.00

25

15

12.00

14.00

0

25.9%
FY2014

30.0%

26.5%

26.6%

FY2015FY2016

30.9%

30.4%

30.6%

30.9%

FY2017

31.0%

27.0%
FY2018FY2019FY2020¥ 100 billion
Dividends per share

33.0%

29.0%

27.0%

Amount of
Share
Buyback

MITSUBISHI ESTATE CO., LTD.

35.0%

16.00

10
5

37.0%

20.00

20

43.0%

FY2021

FY2022(E)

25.0%¥ 30 billion

Payout ratio (right axis)
16

Progress of the Long-Term Management Plan

7. Efforts to Improve Social Values※Re-posting of IR Presentation for FY2021 (disclosed on May 13, 2021)

Accelerate the utilization of renewable energy for the development of a more sustainablecommunity. Improve external opinions through ESG efforts and increase information disclosure.
Switch to Renewable Energy
・19 buildings in Marunouchi and other areas to switch
to renewable energy■Timing

FY2022-■Target properties

Marunouchi Area: 18 buildings
Other areas: 1 building（Yokohama Landmark
Tower）
Total: 19 buildings■CO2 reduction volume 180,000 tons/year

External Reviews（Obtained in FY2021）• Acquired high scores in various benchmarks
Review by GRESB Real Estate＜5 stars (the highest rank, awarded forthe first time)＞
Ranked within top 20% globally

Review by CDP Climate Change 2020
＜A list (the best evaluation, awarded
for the first time)＞
270 companies were chosen among 5,800
companies reviewed(53 of which are Japanese companies)
The first among domestic comprehensive realestate developers to receive the award.

Marunouchi Area

Yokohama Landmark Tower

Review by CDP Supplier Engagement

・Expecting to achieve the *mid-term target renewableenergy ratio ealier than originally set＜Leader (the best evaluation, awarded
for the first time)＞

・Going forward, all power used in Company-ownedbuildings in Marunouchi area will be converted torenewable energy (expected FY2023)

Top 7% were selected among 5,640 companies
globally. (Approx. 80 are Japanese companies)*Mid-term target is to reach 25% by 2030. (The ultimate target is 100% by 2050.)
MITSUBISHI ESTATE CO., LTD.

17

Progress of the Long-Term Management Plan

8. Initiatives Looking Ahead to Post-COVID-19※Re-posting of IR Presentation for FY2021(disclosed on May 13, 2021)

Enhancing value in the office by sophisticating the core functions of the central office andadapting to diversified workstyles.
Previous workstyles

Sophistication of the Central OfficeTOKYO TORCH (Tokiwabashi PJ)• 2ha outdoor space• Communal space for workers• Flexible office use by multiple
tenants• Implementation of contactlesssecurities• Large hall (2,000 seats)• World-class hotel (100 rooms)• Eco-friendly city development (e.g.
green bonds)

Work at a predeterminedplace and time.

New workstyles
Central office as the core hub of acompany in order to maintain asense of belonging and trust
among employees with diversified
values.

FINOLAB (renewal)• Financial support for startups(investing in FINOLAB FUND)• Renewal and expansion• Support services for businessexpansion

Approaches to diversified workstyles
WORK × ation Site
(Workation)• Establishment of a
new hub（fourth hub）

NINJA SPACE
・To locate
workspaces

MITSUBISHI ESTATE CO., LTD.

Telecubes• Increase
installment
numbers• Expandinstallation spots
to condominiums
etc.

CIRCLES（Compact office）• Completed in 3 buildings• Currently planning to develop
at least 10 buildings• Aim is to develop 30
buildings by 2024

18

Financial Supplemental Data

MITSUBISHI ESTATE CO., LTD.

19

Financial Supplemental Data

1. Management Indicators

Previous Management
Plan Period

Current Management
Plan Period

FY2018FY2019FY2020

FY2021

FY2022(Estimate)

2030
Target¥ 213.4 bn¥ 229.4 bn¥ 240.9 bn¥ 224.7 bn¥ 245.3 bn¥ 350-400
bn

*2ROA

3.8%

4.0%

4.1%

3.8%

4.0%

5％

ROE

7.3%

7.8%

8.5%

7.6%

7.6%

10％

EPS

¥ 86.78¥ 96.97¥ 108.64¥ 101.34¥ 106.70¥ 200*1BusinessProfits*1 BusinessProfit = Operating Income + Equity in Net Earnings/Loss (for unconsolidated subsidiaries and affiliates)
Profit / Total Asset (average of opening / closing balances)*2 ROA = Business

MITSUBISHI ESTATE CO., LTD.

20

Financial Supplemental Data

2. Balance Sheet As of June 30, 2021
Millions of yen (rounded down)

Current assets
Cash
Trade notes accounts receivable,
and contract assets
Property for sale
Property for sale in progress
Property for development
Equity investments
Other
Fixed assets
Tangible assets
Intangible assets

Investment securities
Other

Total assets

Total Assets(as of June. 2021)
International
Business
1,061,613
Residential
Business
695,888

Other
325,000

At June 30,
At March 31,
2021
2021
1,290,205
1,164,037
270,523
170,040

ChangeCommercial
Property Business
4,216,957

MITSUBISHI ESTATE CO., LTD.

126,167
100,483

40,47352,031△ 11,558

39,814
303,632
975
538,693
96,0925,009,253
4,270,596
102,067
278,778

88,116
267,563975
496,182
89,126
4,908,481
4,179,893
101,095
281,996△ 48,302
36,069△042,5106,965
100,771
90,703972△ 3,217357,8096,299,458

345,494
6,072,519

12,313226,939

Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term borrowings
Current portion of long-term debt
Commercial Papers
Bonds due within one year
Other
Long-term liabilities
Bonds
Long-term debt
Other
Net assets
Shareholders’ equity

Other accumulated comprehensive income

Stock acquisition rights
Non-controlling interests
Total liabilities and net assets

Change190,406
138,874△ 25,331
60,024△ 34,105
109,000
45,000△ 15,713
51,532
10,36040,635536
36,533
1,474
37,646△ 2,587
226,939

Consolidated Interest-Bearing Debt Consolidated Interest-Bearing Debt Consolidated Interest-Bearing Debt
(as of Mar. 2021)
Fixed/Floating Rate Ratio
Long-term/Short-term Ratio
Commercial Papers
50,000

Lease obligations
2,095(as of Mar. 2021)

2,526,142
Loans
1,663,288(as of Mar. 2021)
Short-term
7.6%

Floating
16.8%

Bonds
810,759
6,299,458

Millions of yen (rounded down)
At June 30,
At March 31,
2021
2021
4,201,478
4,011,071
801,311
662,437
35,17660,507
201,809141,785
93,537
127,643
159,000
50,000110,000
65,000201,787
217,500
3,400,166
3,348,634
756,119745,759
1,434,494
1,393,858
1,209,549
1,209,011
2,097,980
2,061,447
1,261,362
1,259,887
629,657
592,011231
231
206,728
209,316
6,299,458
6,072,519

2,526,142

Fixed
83.2%

2,526,142

Long-term
92.4%

21

Financial Supplemental Data

3. Asset Compositions(End of June 2021)

Inventories

Equity Investments

11%

17%
29%

0%

¥

350.9 billion

10%
13%

¥

Tangible Fixed Assets

538.6 billion

3%
4%
2%
3%
¥

5%

4,270.5 billion

11%
83%

Domestic Condominiums
US
Others73%

36%

Domestic (office buildings)
Domestic (others)
US
EuropeAsia

Office Buildings
Logistics Facilities
Rental Apartments
OthersOutlet Malls*Retail Properties
Overseas* Excluding outlet malls

MITSUBISHI ESTATE CO., LTD.

22

Financial Supplemental Data

4. Consolidated Cash FlowMillions of yen (rounded down)①FY20211Q
Results②FY20221Q
Results

Change（②－①）③FY2021
Results④FY2022
Estimates△ 15,384

26,70442,088207,414

187,000△ 20,414

Depreciation and amortization

21,40722,068661

89,10790,000893

Change in Inventories

16,38824,674

8,285

56,44396,00039,557

Change in Equity Investment△ 2,041△ 9,136△ 7,094△ 21,048△ 131,000△ 109,952△ 75,648△ 102,266△ 26,617△ 297,303△ 352,000△ 54,697

8,388

3,749

△ 4,639

14,18617,0002,814

Capital Investment△ 71,345△ 98,485△ 27,140△ 319,841△ 394,000△ 74,159

Cash Flow From
Financing Activities

95,080172,755

77,67450,425145,000

94,575

Cash and Cash Equivalents
at End of Year

215,014274,685

59,671

172,307

152,000△ 20,307

Free Cash Flow

△ 91,032△ 75,562

15,470△ 89,889△ 165,000△ 75,111

Cash Flows From
Operating Activities

Cash Flows From
Investing Activities
Proceeds from sales ofinvestment securities

MITSUBISHI ESTATE CO., LTD.

Change（④－③）

23

Financial Supplemental Data

5. Investment Data
Major Breakdown of Capital Investments(Billions of yen)

331.8

350.0

289.5
11.8

7.1

285.0
13.0

250.0
200.0
150.0
100.0
50.0
0.0

(Billions of yen)

394.0

400.0

300.0

Major Breakdown of Equity Investments

6.5
9.0

10.7
12.3

319.8
8.1
25.2

4.3

32.0
13.0
99.0

47.4

113.8

74.7

22.1

38.4

39.9

36.9

47.8

16.8
21.3

15.6
23.9

19.2

68.4

63.5

72.4

60.0

FY2019FY2020

FY2021*

FY2022

36.0

6.5

15.9
96.3

FY2018

76.9

1.0

350.0
300.0
250.0

93.4

70.6

400.0

82.0

93.0
14.0

200.0

176.0

150.0

56.0

99.4

100.0
50.0
0.0

FY2018FY2019

93.7

2.3

2.1

3.0

78.0

75.1

49.0

8.8
13.2

42.6

37.0

FY2020

FY2021*

FY2022(E)2.0*Classifications have been changed below from FY2021<Legend for FY2018 - FY2020><Legend for FY2021 - >Office Building(MEC: New/Redevelopment)

Office Building(MEC: Refurbishment)

Office(MEC: New / Redevelopment)

Office(MEC: Refurbishment)

Office Building(Subsidiaries)

Lifestyle Property

Residential

International

Commercial Property(excluding MEC office)

Residential

Hotel & Airport

Special Purpose Vehicle

International

Special Purpose Vehicle

Other(including consolidated eliminations)

New Investments

Others(including consolidated eliminations)

New Investments

MITSUBISHI ESTATE CO., LTD.

24

Financial Supplemental Data

6. Income Generating Assets Unrealized Gains: Current Status #1
Steady caprate and a slight increase in unrealized gains. Decrease in average number of shares and increase in
BPS and revised BPS due to an increase in net worth.
Income Generating Assets Unrealized Gain
Book value(Billions of yen)
9,000

7,941.1

8,000

6,079.0

5,000
4,000

8,270.8

8,361.2

2,180.7

2,569.0

2,963.5

3,422.8

3,898.4

4,222.5

4,250.2

3,606

3,241
2,950
2,643

2,800

2,300

2,178

1,800
3,318.1

3,509.9

3,828.4

FY2015FY2016FY20173,960.5

4,042.7

4,048.3

4,110.9
1,300

1,000
0

3,432

2,384

3,000
2,000

Adjusted BPS

3,800

3,300

6,791.9
5,498.9

BPS

(Yen)

7,383.4

7,000
6,000

Unrealized gain

*BPS and Adjusted BPS

FY2018FY2019FY2020

FY2021

800

1,078

1,088

FY2015FY2016

1,148

FY2017

1,224

1,276

1,269

FY2018FY2019FY20201,383

FY2021＊ BPS including unrealized gains (after tax)

MITSUBISHI ESTATE CO., LTD.

25

Financial Supplemental Data

7. Income Generating Assets Unrealized Gains: Current Status #2

Unrealized Gain Breakdown

Rental Profits(Billions of yen)
190

International
10%

180

174.8

Marunouchi
Existing Building
29%

FY2020

FY2021160.7

160*Marunouchi
New Building
44%

180.2

168.3

170

Domestic(Outside of Marunouchi)
17%

180.5

150
140

131.7

136.2

130
120
110
100

FY2015FY2016FY2017FY2018FY2019*Redeveloped properties after the completion of Marunouchi Building
FY2021 Results

MITSUBISHI ESTATE CO., LTD.

26

Overview of the "Long-Term Management
Plan 2030"

MITSUBISHI ESTATE CO., LTD.

27

Overview of the "Long-Term Management Plan 2030"

1. New Management Plan: Objectives*Repost from the "Long-Term Management Plan 2030"

Mitsubishi Estate Group’s Mission:
Creation of a truly meaningful society through urban development
2030 Target
Address Four key themes*
to realize a sustainable
society*「Environment」「Diversity & Inclusion」「Innovation」「Resilience」

Fundamental Approach

Increasing
SocialValue

Increasing
Shareholder
Value

Create value for every
stakeholder including visitorsand employees

2030 Target

A pair of driving wheels

Synergy

ROA

ROE

5%

10%

EPS
¥

200

Fundamental Approach
Transformational
improvements to thebusiness portfolio's efficiency
and market resilience

Realize our mission and sustainable growthby increasing both social value and shareholder value
MITSUBISHI ESTATE CO., LTD.

28

Overview of the "Long-Term Management Plan 2030"

2. Quantitative Target - 2030 Target*Repost from the "Long-Term Management Plan 2030"

2030 Target
ROA*1

ROE

EPS

5％

10％

¥200

*1 ROA ＝ Business Profits*2 / Total Asset (average of opening/closing balances)

Key Assumptions
Profit Growth

Shareholders Returns

Financial Stability

Current framework*

Maintain

Business Profit*2• Payout ratio:
Approx. 30%¥350–400 bn• Share buybacks+(when determined to be an
optimal use of funds)

current level ofcredit ratings【Reference】
R＆I：AAS＆P：A＋
Moody‘s：A2** Will adjust to business conditions*2 Business Profit= Operating Income + Equity in earnings (loss) unconsolidated subsidiaries and affiliates

MITSUBISHI ESTATE CO., LTD.

29

Overview of the "Long-Term Management Plan 2030"

3. 2030 Targets: Realization Plan (ROA・ROE・EPS)
Current (FY20)*Repost from the "Long-Term
Management Plan 2030"

2030 Target

Business Profits

Increase of ¥120–170 bn¥350-400 bn¥230.5 bn

Approx. ¥50bn growth from each of: domestic
asset, international asset, non-asset business(EPS: ¥200)<Assumption of total asset changes>(EPS: ¥100.2)

Total Assets【 Flexible capital policy 】

Business Profits

Total Assets¥5.9 tn

Approx. ¥7-8 tn

Optimize investments, assets sales, shareholder
return and financing according to market
conditions

Expected net increase: ¥1-2 tn＝

ROA: 3.9%

ROA: 5%
With current leverage

ROE: 7.8％
MITSUBISHI ESTATE CO., LTD.

Increase Net investment: Approx. ¥2–3 tn
Decrease Depreciation: Approx. ¥1 tn

ROE: 10％30

Overview of the "Long-Term Management Plan 2030"

4. Capital Policy - Responsive to Market Conditions*Repost from the "Long-Term
Management Plan 2030"

Flexible capital policy - Responsive to market conditions(Value creation through BS management)
Optimize mix of investment, asset sales, shareholders returns,
and financing in response to the market
Sellers' market
Asset Sales:

Profits:

Shareholder return:Buyers' market
Active acquisition/investment

To maximize mid-to-long value, we combine:
1. stable CF from long-term development PJs and asset holdings Capital gain
2. capital recycling business in response to the market.

::

Shareholders return:

MITSUBISHI ESTATE CO., LTD.

31

Overview of the "Long-Term Management Plan 2030"

5. Value creation through BS management*Repost from the "Long-Term Management Plan 2030"

Flexible Capital Policy - Responsive to market conditions(Value creation through BS management)
Asset

Shareholders’ Equity and Liability

Capital recycling business optimized for market
conditions

Maintaining Financial Stability

 In seller's market: expedite asset sales Financial reserves for seizing buyer's market opportunities

 Invest in promising PJs to enhance corporate value

 High credit rating enables long-term and low-cost financing

Long-term development and asset holdings(core focus: Marunouchi redevelopment)

 Steady capital investment in core business enables stable,
cycle-proof rental cashflow
 Timely asset sales judged by expected yields and external
environment

Sale of underperforming properties andstrategic-holding stocks
 Disposal of underperforming assets, including core asset
 Ongoing disposal of strategic-holding stocks

Expansion of Non-asset Business

MITSUBISHI ESTATE CO., LTD.

 In sellers' market, use asset sale proceeds for shareholder
returns and to maintain financial stability

Capital Efficiency Improvement
 Targets: ROA 5%, ROE 10%, EPS ¥200
 Increase numerator (net income) and decrease denominator(shareholders’ equity) Choose measures to manage shareholders’ equity according
to market conditions

32

Overview of the "Long-Term Management Plan 2030"

6. Capital Allocation Policy
Cash inFinancialcapacity*Repost from the "Long-Term Management Plan 2030"

Cash out
Strategic
Allocation
investments/
shareholder
return/suppression ofdebt

Strategic allocation to improve medium- to longterm capital efficiency
 Allocate capitals based on market conditions
 Select projects which help to increase shareholder value

Capital recycling business expected returns (pre-tax IRR)

Domestic: 6-8％
International (developed countries) : 8-10％
International (developing countries) : 10+％
*Expected return from total investment in each business

Cash flowfromoperatingactivities

Plannedinvestment &return* Including undetermined projects. See p. 40 for the next three-year forecastBaseshareholders
returnMITSUBISHI ESTATE CO., LTD.

Planned projects – return through asset sales (book value)

Payout ratio: Approx. 30％* Shareholder return method and scale will be adjustedwith real estate and financial market conditions, stock price, and ROE/EPS

33

Overview of the "Long-Term Management Plan 2030"

7. Profit Growth Strategy - 2030 Vision
Profit changes vs FY2020*① Domestic AssetBusiness

Approx. +¥50 bn(FY20E*: Approx. ¥ 201.0 bn)② International AssetBusiness

Approx. +¥50 bn(FY20E*: Approx. ¥ 36 bn)③ Non-asset BusinessApprox. +¥50 bn(FY20E*: Approx. ¥ 16 bn)④ Fluctuation Factors
Approx. ±¥20–30 bn* Composition of FY20 Business(round number)

MITSUBISHI ESTATE CO., LTD.

*Repost from the "Long-Term Management Plan 2030"

Growth Strategy① Advance “Marunouchi NEXT Stage” project② Increase NOI with development projects③ Optimize capital recycling business to market conditions④ Optimize residential business profit structure① Expand development business in Asia
② Enhance development business and revenue base in Europe③ Enhance and diversify US capital recycling business① Steady profit growth in existing businesses② Utilization of technology③ Provision of service contents focusing on B2C/B2B2C・Asset sales control in response to market conditions
・Capital gain and rental profit fluctuation due to investment opportunities

Profits = ① Domestic Asset + ② International Asset + ③ Non-asset Business + Eliminations or corporate(¥ 201.0 bn)(¥ 36 bn)(¥ 16 bn)(▲ ¥ 23 bn)

34

Overview of the "Long-Term Management Plan 2030"

8. Roadmap for Profit Growth
Early stage

Domestic
Asset
Business

International
Asset
Business

Non-asset
Business

MITSUBISHI ESTATE CO., LTD.

*Repost from the "Long-Term Management Plan 2030"

Middle stage

Advanceredevelopment projects

Late stage

Redevelopment Projects’ Contribution• Complete Tokiwabashi A Bldg.
• Open & expand outlet mall
• Asset sales and reconstruction of existing buildings (willlower rental profits)• Temporary decline in the condominium units sold

• Long-term developments, e.g. Tokiwabashi B Bldg.
• Residential redevelopments

Profits scale with asset accumulation

Stabilize profits via capital recycling• 1271 Ave. of the Americas renewal, 8 Bishopsgate
completion• Stabilize Asia condominium business• Expand assets in Asia capital recycling business

Promoting commercialization in new domains• Stable growth in existing businesses• Promoting commercialization in new domains• Shift from asset expansion to recycling• Stabilize capital recycling business in Asia

Accelerate profits in new domains• Stable growth in existing businesses• Accelerate profits in new domains

35Overview of the "Long-Term Management Plan 2030"

9. Three Year Investment Return Plan (FY2021-FY2023)*Repost from the "Long-Term
Management Plan 2030"(Billions of yen)

3-Year Total

Composition
Planned Investments and Return
Domestic Asset

International Asset

Strategic Allocation
600(investments/shareholders return/suppression of debt)
Investment

Outlet mall,
Capital Recycling asset,
And Others

Plannedinvestments

Condominium

1,500

Marunouchi
area

150
0

ReturnMITSUBISHI ESTATE CO., LTD.

150

Vary investment allocation
for medium- to long-term
capital efficiency

600

Europe and
US
Asia

100

200
Aim for international profit
growth

500
300

Net
Investment

Disposeunderperforming assets
for capital efficiency

550

Asset sales plan assumes
market conditions of previous
three years

100～200

Strategic
Allocation

500

Return1,100Strategic Return

Strategic
Return

0

250

100

0

200

100～200

0-100～-200

～600

36

Business Overview

MITSUBISHI ESTATE CO., LTD.

37

Business Overview

1. Mitsubishi Estate Group’s Business Segments
Commercial Property Business＜Office Buildings＞
Engages in the development,
leasing, and operation
management of office buildings,
mainly in the Marunouchi area andother major Japanese cities.

＜Retail Properties＞
Develops retail properties andoutlet malls nationwide, mainly inthe major metropolitan areas.

Residential Business

International Business＜Domestic Residential＞
Operate residential condominium
business under "The
Parkhouse" brand and rental
apartments business under "The
Parkhabio" brand.

Undertakes office building
development andleasing businesses in the UnitedStates and the United Kingdom, as
well as projects in Asia

＜Logistics Facilities＞
Development, leasing, andmanagement of the “Logicross”
series as a foundation of logistics
facilities.

＜Hotels/Airports＞
Undertakes hotel management
nationwide as the Royal Park Hotels
group. Began private airport
management business.

Investment Management
Business

Architectural Design &Engineering and Real Estate
Service Business

Provides a wide range of services
regarding real estate investment
for investors.

＜Architectural Design &Engineering Business＞
Mitsubishi Jisho Sekkei Inc.
provides architectural design andengineering services of construction
and civil engineering.
＜Real Estate Services Business＞
Mitsubishi Real Estate Services Co.,
Ltd. offers real estate brokerage,parking lot management support,
and other services.

MITSUBISHI ESTATE CO., LTD.

38

Business Overview

2. Business Scale

Investment
Management
Business2%

Other*
6%

Investment
Management
Business
2%

International
Business
15%

International
Business
9%
Revenue fromOperations

Residential
Business
10%

Approx.

Residential
Business
29%¥1,207.5
billion

Other*
0%Commercial
Property
Business
54%*Other2%

Investment
Management
Business
1%
International
Business
16%

Operating Income

Approx.

Residential
Business
11%¥224.3billionTotal Assets

Commercial
Property
Business
73%

Approx.

¥6,072.5
billionCommercial
Property
Business
70%*Architectural Design & Engineering Business and Real Estate Services Business, Other Business(FY2021 Results)

MITSUBISHI ESTATE CO., LTD.

39

Commercial Property Business
Office Buildings

MITSUBISHI ESTATE CO., LTD.

40

Commercial Property Business (Office Buildings)

1. Marunouchi Area Map

MITSUBISHI ESTATE CO., LTD.

41

Commercial Property Business (Office Buildings)

Marunouchi Area

2. Pipeline
Tokiwabashi Tower
Bldg. A

Uchikanda 1-chome
Project

Torch Tower Bldg. B

Total Floor Area: 180,900㎡
Completion: Sep. 2020

Total Floor Area: 146,000㎡
Completion: Jun. 2021

Total Floor Area: 84,500㎡
Completion: 2025

Total Floor Area: 544,000㎡
Completion: FY2028

FY2020

FY2021

Link Square Shinjuku

FY2022

CO･MO･RE YOTSUYAFY2023

FY2024

Yurakucho
Redevelopment(TBD)

FY2028the ARGYLE aoyama(Tentative name)Toyosu 4-2 Project

Kokusai Shin-Akasaka
Building and others
Redevelopment Project

Total Floor Area: 23,100㎡
Completion: Jun. 2020

Total Floor Area: TBD
Completion: Spring 2025

Total Floor Area：TBD
Completion：FY2029

Tokyo(Outside of Marunouchi)(Tentative name)

Mizuho Marunouchi Tower,
Ginko Kaikan,
Marunouchi Terrace

撮影：SS

Total Floor Area: 43,800㎡
Completion: Aug. 2019

MITSUBISHI ESTATE CO., LTD.

Total Floor Area: 139,600㎡
Completion: Jan. 202042

Commercial Property Business (Office Buildings)

3. Earnings Related Data: Total Operating Floor Space (Unconsolidated)
Total (Domestic)/Marunouchi/Marunouchi Redevelopment Buildings(Thousand ㎡)

6,500
6,000

5,444

5,500
5,000
4,500
4,000

3,684 3,696

3,825 3,907

4,175

4,347

4,660

4,896

5,580 5,670
5,174

5,038

5,385

5,570

5,745

3,000

2,000

1,677

1,798

1,946 2,024 1,897

2,195 2,258

1,500
1,000
500
0

256

256

355

03/3

04/3

05/3

5,991 6,009

3,769

3,500

2,500

5,869

489

489

06/3

07/3

743

743

08/3

09/3

Total (Domestic)

2,565 2,565

2,687 2,758 2,755 2,583

1,022 1,022

10/3

11/3

Marunouchi

1,174

12/3

2,531

1,383 1,365 1,360 1,345

13/3

14/3

15/3

16/3

2,727 2,784

1,705 1,705

17/3

18/3

2,915 2,915 2,952

1,836 1,836 1,872

19/3

20/3

21/3 22/3(E)Marunouchi Redeveloped Buildings*Excluding floor space in Lifestyle Property Business from 16/3

MITSUBISHI ESTATE CO., LTD.

43

Commercial Property Business (Office Buildings)

4. Earnings Related Data: Vacancy Rates and Average Rents (Unconsolidated)
Vacancy Rates (Marunouchi Offices/All uses in Japan) and
Average Rents (All uses in Japan)(yen / tsubo-month)10%

30,00029,000Vacancy rate (Marunouchi offices)

28,000Vacancy rate (All uses in Japan)
Average rent (All uses in Japan)

27,00026,00024,86425,00023,56024,00023,00022,00021,00022,213

21,733
21,902
21,711
4.82%

20,00017,00013,000

0.55%
04/3

05/3

MITSUBISHI ESTATE CO., LTD.

4.32%

06/3

07/3

3.66%

2.42% 2.26%

6%

0.19%
08/3

4%
2.80%

2.90%

2.93%

2.22%

2.42%

2.06%

1.74%

7%

23,587

3.98%
3.58% 3.58%

2.86%
1.68%

14,00012,000

3.40%

2.77%

23,8615%

4.36%

15,00023,850

9%
8%

5.29%

2.77%

16,00023,97425,842

26,702

22,602

3.59%

19,00018,00024,42325,234

26,193

27,17728,50027,793 27,935

1.82%

1.09%

2.50%

2.19%
1.87%
2.42%

3.0%

1.07%

2.35%

2%

2.49%

1.65% 1.80%

1.37%

1%
0.69%

09/3

10/3

11/3

12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

3%

20/3

21/3

21/6

22/3
(E)

0%

44

Commercial Property Business (Office Buildings)

5. Earnings Related Data: Office Building Business, Revenue Breakdown*1(Unconsolidated)(Billions of yen)

FY2021-1Q(Results)

FY2021（Previous
Estimates）

FY2022-1Q(Results)

FY2022(Estimates)

Rent revenue from *1office buildings

102.7

418.0

107.1

428.3

Changes from the previous period+ 2.8+ 11.3+ 4.4+ 10.2Rent revenue from new buildings+ 2.0+ 12.2+ 3.1+ 15.8Rent revenue from existing buildings

+ 3.5

+ 7.2

△ 0.5

△ 3.3

△0

△ 0.7

△ 0.9

△ 6.5

+ 3.6

+ 8.0

+ 0.3

+ 3.2

Offices-△ 0.5*2Mixed-use retail

△ 2.3

△ 5.0

Supplementary revenue, incl. common area charge

△ 0.4

△ 2.4

+ 1.8

△ 2.2

Termination of master lease,closure of building for redevelopment
Moving in/out of tenants,
Rent revisions at lease renewal

Impact of COVID-19*1 Office buildings,

incl. those with retail areas, etc.

*2 Retail properties in office buildings

MITSUBISHI ESTATE CO., LTD.

45

Commercial Property Business (Office Buildings)

6. Earnings Related Data: Trends in Rent Revenue From Office Buildings*1(Unconsolidated)
Increase/Decrease of Rent Revenue from Office Buildings*1(From the Previous Fiscal Year)(Billions of yen)

30
25

■New buildings■Existing buildings (moving in/out of tenants, rent revisions at lease renewal)■Existing buildings (termination of master lease, closure of building for redevelopment)+0.3■Impact of COVID-19 (office buildings, *2mixed-use retails)

20

+0.3

15

+15.3

10
5

+13.0

0
-5

-20
Total

+8.7
-4.9

-10.7

-10
-15

+15.3

-1.1
-5.9

-5.4

+7.3
+1.9

+6.0
-1.5

+14.7

+27.2

+23.9
+12.5

+7.3
-1.5

-10.5

-4.0
-2.5

-4.6
-5.6

+9.5

-5.2
-6.0

+6.6
-3.4

-0.7
-7.5

+22.6 +0.7 +17.9+18.5 +13.2

+2.4
-9.0

-8.3

+4.9

-10.5

+10.8

+9.8

+4.0

+4.7

+5.9

+6.5

+12.2
+15.8
+3.1

+8.0
-0.7
-5.5

-8.1

+3.2

+0.3

-6.5

-0.9

-5.0
*1 Office buildings,

incl. those with retail areas, etc.

*2 Retail properties in office buildings

04/3

05/3

06/3

07/3

08/3

10/3

11/3

12/3

13/3

14/3

15/3

16/3

17/3

-2.7

-1.6

+8.3

-1.3

+19.8 +20.5 +17.4

+2.3

-1.7

-5.1

+19.0 +11.9+7.6+18.5 +15.2 +24.1 +17.6 +14.0 +12.5

MITSUBISHI ESTATE CO., LTD.

09/3

18/3

19/3

20/3

21/3

22/3(E) 22/3-1Q

+2.5

46

Commercial Property Business (Office Buildings)

7. Office Building Market Data: New Supply of Large-Scale Office Buildings(23 Wards of Tokyo)(Millions of ㎡)

2.5
2.16
2

1.79

1.75
1.54
1.5
1.25

1.19

0.72

0.77

1.09
0.87

0.86 0.85
0.65

1.45

1.41

1.17

0.91

1

0.5

1.21

Historical average supply
Approx. 1.07 million ㎡/year(1999-2020)

Projected average supply
over the next 5 years
0.94 million ㎡/year

0.58

1.2
0.97

0.93

0.85
0.69

0.61

0.49

0.36

0
*Estimate*Research subject buildings: Buildings with a total office floor area exceeding 10,000㎡
Source: Mori Building (as of May 2021)
MITSUBISHI ESTATE CO., LTD.

47

Commercial Property Business (Office Buildings)

8. Office Building Market Data: Average Rents/Vacancy Rates(5 Central Wards of Tokyo)(yen / tsubo-month)12%

30,000
Average Rent

28,00026,00024,000

8.75%

10%
8.56%

7.98%
22,5745.51%

20,00020,064

6.70%

6.05%

16,0003.41%

19,6995.30%

6%2.72% 2.89%

6.19%
5.42%
4%

2.80%

12,00010,000

2%
1.78%

04/3

05/3

06/3

21,541
21,16021,134

18,73018,264
17,973
17,495
17,195
16,71616,504
16,325
3.60%
4.34%

18,09517,75817,593

14,000

07/3

08/3

8%

22,594

21,29522,00018,0009.19% 9.04%

Vacancy Rate

09/3

10/3

11/3

12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

1.50%
20/3

21/3

21/6

0%

Source: Miki Shoji Co., Ltd.
MITSUBISHI ESTATE CO., LTD.

48

Commercial Property Business (Office Buildings)

9. Competitive Edge of Marunouchi: Vacancy Rates
5 Central Wards of Tokyo (Market) vs. Marunouchi(Unconsolidated)

10%

8.75%

9%

9.19% 9.04%

8.56%

7.98%
8%
6.70%

7%

6.19%
6.05%

6%

5.42%

5.51%
5%

4.36%

4.32%
3.66%

4%
3.41%

3%

2.72%

2.77%

1.74%

1%

0.55%
04/3

05/3

06/3

07/3

4.34%

2.42%
2.89%

2%

0%

5.30%

0.19%
08/3

2.42%

2.80%

2.50% 2.49%

2.19%
1.50%

2.26% 2.42%

1.82%

1.09%
09/3

3.60%

1.65% 1.78%

1.37%

0.69%
10/3

11/3

12/3

5 Central Wards of Tokyo (Market)

13/3

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

21/6

Marunouchi (Unconsolidated)
Source: Miki Shoji Co., Ltd.

MITSUBISHI ESTATE CO., LTD.

49

Commercial Property Business (Office Buildings)

10. Competitive Edge of Marunouchi: Area/Number of Railway Lines

Marunouchi

Nihonbashi

ShinagawaShibuya

Toranomon

2,400m
1,500m

Area:

120ha

Area:

76ha

Area:

49ha

Area:

86ha

Area:

58ha

Railway lines:

28 lines

Railway lines:

5 lines

Railway lines:

9 lines

Railway lines:

8 lines

Railway lines:

2 lines©Open Street Map

MITSUBISHI ESTATE CO., LTD.

50

Commercial Property Business (Office Buildings)

11. Competitive Edge of Marunouchi: Number of Headquarters and Offices(as of March 2021)① Fortune Global 500 company headquarters

21

3

2

0

③ Top 100 law firm headquarters and offices0

MARUNOUCHI33

NIHONBASHI

8
6

TORANOMONMARUNOUCHINIHONBASHISHINAGAWA

SHIBUYATORANOMONSHINAGAWA② Top 50 company headquarters in terms ofmarket capitalization

2

SHIBUYA

0④ Foreign financial company offices

67

MARUNOUCHI

13

MARUNOUCHI6NIHONBASHI

1SHINAGAWA

1TORANOMON0SHIBUYA13

TORANOMON5SHIBUYASHINAGAWA

MITSUBISHI ESTATE CO., LTD.

16

NIHONBASHI

051

Commercial Property Business (Office Buildings)

12. Marunouchi Data: Marunouchi Tenant Mix (Unconsolidated)
March 2000

Type of Business

Area ratio

March 2021

Type of Business

Area ratio

1

Manufacturing

42.5%

1

Finance22.9%

2

Finance22.2%

2

Manufacturing

20.0%

3

Trading

10.4%

3

Professional Firm

19.2%

4

Information

6.3%

4

Trading

10.4%

5Professional Firm

4.4%

5

Information

6.2%

Others

14.2%

Others21.3%

Professional Firm
4.4%
Others14.2%
Information
6.3%
Trading
10.4%

Manufacturing
42.5%

Finance22.9%

Information
6.2%
Trading
10.4%

Finance
22.2%

MITSUBISHI ESTATE CO., LTD.

Others21.3%

Manufacturing
20.0%

Professional Firm
19.2%

52

Commercial Property Business (Office Buildings)

13. Marunouchi Data: Approaches for Marunouchi Area Development
Improvement of floor-area-ratio
Improving plot ratio in Marunouchi area by reviewing the use
area

1,000% → 1,300% (June 2004)*1,200% for limited areas

Transfer of plot ratio:
Exceptional plot ratio district system
Possible to transfer floor area among several areas meeting acertain conditions"Exceptional floor-arearatio district" area

Relaxation of plot ratio regulations: Special
Urban Renaissance Districts
Possible to be permitted for relaxation of floor-area ratio
regulation depending on levels of contribution to city
regeneration as an exemption of urban planning
Example: International business bases (Global Business Hub Tokyo etc.)
Development of fine urban environment (improvement of water quality of ditch
around the Imperial Palace, etc.)
BCP functions (self-reliant electric power, water supply, etc.)

Change of building uses:
Consolidation of non-office use
Possible to consolidate and allocate mandated non-officeuse floor-areas when running several projects
simultaneously◆Example: Consolidate office and hotel usages

Non-office ─◆Example: Transfer unused floor-area at Tokyo station to other buildings
around the station

Office ─Consolidate non-office use in
offices into hotels to expand
office areas in office buildings
Offices
MITSUBISHI ESTATE CO., LTD.

Hotels53

Commercial Property Business
Outlet Malls, Retail Properties, Logistics
Facilities, Hotels, and Airports

MITSUBISHI ESTATE CO., LTD.

54

Commercial Property Business (Outlet Malls)

1. Outlet Mall BusinessChange in Store Area, Revenue fromOperations, and Operating Income(Millions of yen)

Average of all Facilities Sales-Linked &Fixed Ratio (Rent Revenue Basis)(㎡)

50,000400,000

45,000

FY2021Results

62%

350,000

Fixed rent

38%
Sales-linked rent

40,000300,000

35,00030,000250,000

200,000

Tosu

Kobe-Sanda
Rinku

20,000

HANAZONO Sano
Toki

Ami
Gotemba Shisui

GOTEMBA PREMIUM OUTLETS®

150,000

15,00010,000Sendai-Izumi

KYOTO JOYO

25,000

16/3

17/3

18/3

19/3

20/3

21/3

100,000

Name

Open

Gotemba (Phase 4)

Jun. 2020

Before expansion: Approx. 44,600㎡
Currently: Approx. 61,000㎡ (+37%)

Rinku (Phase 5)

Aug. 2020

Before expansion: Approx. 39,400㎡
Currently: Approx. 50,100㎡ (+27%)
Approx. 27,000㎡

Store area

308,500 308,500 308,500 314,600 315,300 345,500

Revenue fromOperations

43,946

43,642

45,462

46,65946,39340,030

Fukaya Hanazono (New)Fall, 2022

Operating Income 16,301

17,35918,94019,673

18,963

14,619

Kyoto Joyo (New)

Spring, 2024

MITSUBISHI ESTATE CO., LTD.

Store Floor Area

55

Commercial Property Business (Logistics Facilities)

2. Logistics Facility Business
Trends in Gain on Sales

Approx. ¥(Billions of yen)
8.0

8.0

2.0
0.0

Assets in Operation
32%(4 buildings)

4.0

Assets under Development
68%(11 buildings)

2.0
18/3

19/3

20/3

Tokyo Ryutsu Center Distribution Building B
MITSUBISHI ESTATE CO., LTD.

61.0 billion

Operational Logistics Facilities
Total number of developed facilities:

15

8.0

6.0
4.0

Total Assets

21/3(End of March 2021)*Ratio by value*Excl. Tokyo Ryutsu Center

Logicross Hasuda

Number of facilities in operation:4

Total floor area of facilities in operation:

192,000㎡(End of March 2021)*Excl. Tokyo Ryutsu Center(Tentative name) Sagamihara-shi Chuo-ku Fuchinobe project56

Commercial Property Business (Retail Properties/Logistics Facilities)

3. Outlet Malls and Logistics Facility Pipelines
FUKAYA HANAZONOPREMIUM OUTLETS®

KYOTO JOYOPREMIUM OUTLETS®

Store floor area: 27,000㎡
Open: Fall 2022

Open: Spring 2024

Outlet Malls

GOTEMBA PREMIUM
RINKU PREMIUM OUTLETS®
OUTLETS® Expansion Phase 4
Expansion Phase 5

Logistics Facilities

Floor Area Expanded: +16,400㎡
Open: Jun. 2020

Floor Area Expanded: +10,700㎡
Open: Aug. 2020

FY2023

FY2021

FY2022

Logicross Hasuda

Logista・LogicrossIbaraki Saito

Total Floor Area: 78,600㎡
Completion: Mar. 2021

Total Floor Area: 147,200㎡ (2 Blocks)
Block A Completion: May 2021
Block B Completion: May 2021

(Tentative name) Sagamihara-shi

FY2024(Tentative name)Chuo-ku Fuchinobe project

Logicross Zama

Total Floor Area: 173,000㎡
Completion: 2023

Total Floor Area: 183,900㎡
Completion: Jun. 2023

Logicross Yokohama
KohokuLogicross AtsugiⅡ

Logicross Ebina

Logicross Kasukabe

Logicross Funabashi

Total Floor Area: 16,400㎡
Completion: Jun. 2019

Total Floor Area: 35,100㎡
Completion: Jul. 2019

Total Floor Area: 61,900㎡
Completion: Nov. 2020

Total Floor Area: 39,300㎡
Completion: May 2021

Total Floor Area: 23,700㎡
Completion: Dec. 2021

MITSUBISHI ESTATE CO., LTD.

57

Commercial Property Business (Hotels)

4. Hotel (Development/Operations) Business
Hotel Management Business
Name

Number of Rooms

Open

Chuo, Tokyo

419

Jun. 1989

Yokohama, Kanagawa

603

Sep. 1993

Sendai, Miyagi

110

Apr. 1995

The Royal Park Hotel Iconic Tokyo Shiodome

Minato, Tokyo

490

Jul. 2003

Marunouchi Hotel
The Royal Park Hotel Fukuoka

Chiyoda, Tokyo205

Oct.2004

The Royal Park Hotel Kyoto Sanjo

Fukuoka, Fukuoka

174

Jul. 2011

Royal Park Hotel
Yokohama Royal Park Hotel
Sendai Royal Park Hotel

Kyoto, Kyoto

172

Oct. 2011

The Royal Park Canvas Nagoya
The Royal Park Hotel Tokyo Haneda

Nagoya, Aichi

153

Nov. 2013

The Royal Park Hotel Kyoto Shijo

Ota, Tokyo

313

Sep. 2014

Kyoto, Kyoto

127

Apr. 2018

Hiroshima, Hiroshima

127

Chuo, Tokyo

121

Oct. 2018
Mar. 2019

The Royal Park Hotel Hiroshima Riverside
The Royal Park Canvas Ginza 8
The Royal Park Canvas Osaka Kitahama

The Royal Park Canvas Sapporo Odori Park

Location

Osaka, Osaka

238

Jun. 2019

The Royal Park Hotel Iconic Osaka Midosuji

Osaka, Osaka

352

Mar. 2020

The Royal Park Canvas Kobe Sannomiya

Kobe, Hyogo

170

Jan. 2021

The Royal Park Hotel Kyoto Umekoji

Kyoto, Kyoto

246

Mar. 2021

The Royal Park Canvas Kyoto Nijo

Kyoto, Kyoto

180Jun. 2021

The Royal Park Canvas Sapporo Odori Park

Sapporo, Hokkaido

134

Oct. 2021

The Royal Park Hotel Iconic Kyoto

Kyoto, Kyoto

130

Spring 2022

Ginza 6-chome Hotel ProjectChuo, Tokyo

160

Fall 2022

Nagoya Sakae Hotel Project

Nagoya, Aichi

250

FY2024

Hotel Development Business
Name

Hilton Okinawa Miyakojima Resort

MITSUBISHI ESTATE CO., LTD.

Number of Rooms

Construction Begins

Open

The Royal Park Hotel Kyoto Shijo

Kyoto, Kyoto

Location

127

Jul. 2016

Apr. 2018

MJ HOTEL Asakusa

Taito, Tokyo

166

Mar. 2017

To be determined

The Royal Park Canvas Kobe Sannomiya

Kobe, Hyogo

170

Sep. 2019

Jan. 2021

The Royal Park Hotel Kyoto Umekoji

Kyoto, Kyoto

246

Jun. 2019

Mar. 2021

MJ Hotel Asakusa Kaminarimon

Taito, Tokyo

51

Dec. 2019

Apr. 2021

The Royal Park Campus Sapporo Oodori Kouen

Sapporo, Hokkaido

134

Mar. 2020

Oct. 2021(Tentative name) Kyoto Okazaki Hotel Project

Kyoto, Kyoto

60

Feb. 2020

Spring 2022

(Tentative name) Naha-shi Nishi 1-chome project

Naha, Okinawa

143

Sep. 2020

Spring 2022

(Tentative name)
Sendai-shi Aoba-ku Chuo 4-chome Hotel project

Sendai, Miyagi

224

Oct. 2020

Summer 2022

Hilton Okinawa Miyakojima Resort

Miyakojima, Okinawa

329

Feb. 2021

FY202458

Residential Business

MITSUBISHI ESTATE CO., LTD.

59

Residential Business1. Condominium Business Data #1
In FY2022, sales will be flat YoY, but deliveries will be scheduled in the 2nd half.
Gross margin improved and inventories are on a downtrend.
FY2021-1Q(Results)
Condominiums
Sold(millions of yen)
Condominiums
Sold(units)Gross Margin

Inventory (units)
New Supply of
Condominiums(units)

FY2021(Results)

FY2022-1Q(Results)

FY2022(Estimates)

20,841

203,513

18,599203,000

312

3,476

289

2,900

19.0%
348
76

18.7%
213
2,350

18.8%
203
454

Land Bank
Breakdown in ReportingTerm(As of March 31, 2021)

5,600

6,900

20.0%
1,700

3,600

Total: 16,100 units
FY2022 - FY2024
FY2025 - FY2027
FY2028 -MITSUBISHI ESTATE CO., LTD.

60

Residential Business

2. Residential Condominium Business #2
Scheduled for delivery in FY2022
Name (project name)

The Parkhouse Mita Garden Residence & Tower

The Parkhouse Takanawa Tower

Location

Site area

Total units

Scheduleddelivery

The Parkhouse Mita Tower

Minato, Tokyo

1,900㎡

111

May 2021

The Parkhouse Ichikawa 2-chome

Ichikawa, Chiba

2,000㎡

57

Nov 2021

The Parkhouse Ichigaya Kagacho Residence

Shinjuku, Tokyo

5,800㎡

228

Nov. 2021

The Parkhouse Mita Garden Residence & Tower

Minato, Tokyo

5,200㎡

266

Dec. 2021

The Parkhouse Shin-Urayasu Marine Villa(Stage 1)

Urayasu, Chiba

47,100㎡※

234

Jan. 2022

The Parkhouse Takanawa Tower

Minato, Tokyo

2,000㎡

164

Jan. 2022

The Parkhouse Musashino KyonanchoMusashino, Tokyo

2,700㎡

82

Jan. 2022

The Parkhouse Nagoya(Stage 1)

Nishi, Nagoya

18,100㎡※

314

Jan. 2022

The Parkhouse Asakadai Residence

Asaka, Saitama

2,300㎡

64

Feb. 2022

The Parkhouse Komazawa Residence

Setagaya, Tokyo

2,700㎡

69

Feb. 2022

The Parkhouse Kamakura

Kamakura, Kanagawa

1,100㎡

23

Feb. 2022

The Parkhouse Kyodo Residence

Setagaya, Tokyo

3,200㎡

91

Feb. 2022

The Parkhouse Tokorozawa Place

Tokorozawa, Saitama

2,400㎡

104

Feb. 2022

The Parkhouse Yokohama Shin Koyasu Front

Yokohama, Kanagawa

7,400㎡

180Mar. 2022

The Parkhouse Miyazakidai

Kawasaki, Kanagawa

4,500㎡

123

Mar. 2022

The Parkhouse Saitama Shin-Toshin

Chuo-ku, Saitama

1,500㎡

109

Mar. 2022※ Total occupying area

MITSUBISHI ESTATE CO., LTD.

61

Residential Business3. Condominium Business Data #3
Quarterly Distribution of Sales by Agreement Date
(Millions of yen)

260,000
240,000
220,000
200,000
180,000
160,000

254,140
238,924
96.5%
89.3%

93.0%

80.7%

84.7%

66.1%

140,000
120,000

202,876
94.8%

73.1%

85.0%

59.2%

70.7%

203,513203,000 (E)

92.6%

90.1%

81.2%
69.9%
64.0%

100,000

68.7%

51.4%

80,00060,00040,00020,000
0

18/3

19/3

Full-year sales

MITSUBISHI ESTATE CO., LTD.

20/3

End of 3Q

End of 2Q

21/3

End of 1Q

22/3

Beginning of FY

62

Residential Business4. Condominium Market Data
Number of New Supplies/Average Prices (the Greater Tokyo Area)(Unit)(Average price/Millions of yen)

120,000

60.8

60

100,000

50

80,00040

60,00030

40,00032,00027,22820

20,00010

001999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
(E)
Number of new supplies

Average priceSource: Real Estate Economic Institute Co., Ltd.

MITSUBISHI ESTATE CO., LTD.

63

Residential Business

5. Redevelopment Projects andLarge-scale Development Projects

6. Rental Apartment Business

Redevelopment Projects and Large-scale Development Projects

Trends in Gain on Sale

*Only major projects are listed
Scheduled
Delivery

Location

Project Name

Total Units(Billions of yen)

Atsugi, Kanagawa

The Parkhouse Hon-Atsugi Tower

163

FY2021

Chiba, Chiba

Makuhari Bay Park Sky Grand Tower

826

FY2023

Yokohama, Kanagawa

Land Readjustment Project (H block) in West
District around Kawawa-cho Station

183

FY2023Kita, Tokyo

Maintenance project of Kami-Jujo 1-chome 4banchi Disaster prevention zone

43

4.0

Shinagawa, Tokyo

Togoshi 5-chome, 19 District Redevelopment
Project

Approx. 240

2.0

Yokosuka, Kanagawa

In Front of Oihama Station Type 1 Urban Zone
Redevelopment Project

Approx. 300

Minato, Tokyo

Mita Koyama-cho Nishi area Type 1n Urban
Zone Redevelopment Project

Approx. 1,200

Chuo, Tokyo

Toyomi area Type 1 Urban Zone
Redevelopment Project

Approx. 1,700

Chiyoda, Tokyo

Kanda Ogawa-cho 3-chome West-side South
area Type 1 Urban Zone redevelopment
Project

After FY2025

Total

The Parkhouse Hon-Atsugi Tower
MITSUBISHI ESTATE CO., LTD.

Approx. ¥12.0

FY2021

10.0

11.0

8.0

7.0

46%
(39 buildings)
Assets in Operation
54%(28 buildings)

1.0
18/3

117 billion

Assets under Development

10.0

6.0

0.0

Total Assets

19/3

20/3

21/3

*Trends in capital gains for Residential Business(End of March 2021)*Ratio by value

Approx. 110
Approx. 23,300

The Parkhabio Kiba

Parkhabio Akasaka Tower

64

International Business

MITSUBISHI ESTATE CO., LTD.

65

International Business1. International Business Strategy
FY2021
29%

Asia2030 Target

US

Towards 2030 Target

16% Expand Asia development businessBusiness Profit:¥37.9 bn13%

 Annual investment: Approx. ¥200–250

bn

Total Asset:¥929.8 bn
21%

Europe71%

 1st half of 2020s: Profit increase with50%

asset accumulation

Business Profit:
Approx. ¥90 bn

35%

40%
45%
45% Total Asset:
Approx. ¥1.5 tn(2030 target)(2030 forecast) 2nd half of 2020s:

15%
20%

Balance investment and return

ROA：Approx. 6%

ROA：Approx. 4.2%
Strategies①Asia②Europe Increase investments, build capital
recycling portfolio
 Two approaches:①Development with major stakes②Joint businesses with local partners＜Expected Return from Investment＞
IRR

Developed countries
Developing countries

MITSUBISHI ESTATE CO., LTD.

8-10%
10+%

③US

 Investment and return to optimize profit
stability and capital efficiency
 Advance mainly large-scale**8 Bishopsgate, 60-72 Upper Ground＜Expected Return from Investment＞
IRR

8-10%

 Strengthen capital recycling business andcapitalize on RGII* know-how
 Promote joint ventures with local partners*Rockefeller Group International, Inc.

＜Expected Return from Investment＞
IRR

8-10%

66

International Business2. International Assets/Ongoing Projects
Many ongoing developments (rentals and condos) are expected to make early profit contributions.
International Assets

Major Ongoing Projects(Mar. 2021)*Book Value:¥764 bn

Property Name

17%

31%

Asia

30%
22%
EuropeUS (Manhattan)

US (Other)

EuropeAsia*Inventories + Equity Investments + Tangible Fixed Assets

US1271 Avenue of the Americas

Location

Singapore

2021*293,400㎡

Office2021

172,300㎡

2021
2021
After 2022
2022

75,000㎡*324,600㎡*2212,700㎡
60,000㎡

One City Centre

Thailand (Bangkok)

Office2022

61,000㎡(Tentative name) 8 Bishopsgate
Park Central(Previously: Nine Elms Parks)

UK (London)

Office2022

53,000㎡

UK (London)

Rental apartment2022

196 units60-72 Upper Ground (ITV The London
Television Centre)

UK (London)

Multi-use

2020s 2nd
half

TBD

1271 Avenue of the Americas

US (Manhattan)

OfficeDec. 2019

195,000㎡

Middlesex

US (New Jersey)

Logistics facilities

2021

121,500㎡

Liv Crossroads

US (Arizona)

Rental apartment

2022

356 units*1Leasable area or # of units *2Total floor area

*3Area for sale

China (Hangzhou)

Multi-use

Multi-use
OfficeMulti-use
OfficeLand Bank in Asia
(Condominiums)

350
400
550

50

300

1,250
2,000

MITSUBISHI ESTATE CO., LTD.

Area / Units*1

Indonesia (Jakarta)
The Philippines (Manila)
Myanmar (Yangon)
Australia (Sydney)

CapitaSpring

Trinity Tower

Completion

CapitaSpring
Phase 3 of Singapore-Hangzhou Science& Technology Park
Trinity Tower
Savya Financial Center North Tower
Yoma Central (4 buildings total)
180 George Street

Total: 10,700 units(Tentative name)
8 Bishopsgate project

Use

5,800

ThailandChina

Indonesia

VietnamPhilippines

Malaysia

Australia

Others(as of Mar. 2021)* # of units MEC owns

67

Other Businesses

MITSUBISHI ESTATE CO., LTD.

68

Other Businesses

1. Investment Management Business: Global Platform
Globally, we have a combined asset value under management of approx. ¥3.7 trillion.
EuropeUnited States

Europa Capital

AuM Area Breakdown

TA Realty(Billions of yen)

Asia & Oceania
130

Asia-Pacific

Pan Asia Realty Advisors
CLSA Real Estate

Europe490

Carry out marketing and research and establish funds worldwide
Overseas

Provide global opportunities to worldwide investors

Japan
Groupwide
Synergy

Japan Real Estate AssetManagement Co., Ltd.

(JRE)

Mitsubishi Jisho
Investment Advisors, Inc.

(MJIA)

Mitsubishi Estate Group’s network
for investment & development and management & services
MITSUBISHI ESTATE CO., LTD.

JREA
1,070

Total:
approximately¥ 3.7 trillion.

United States
1,100

Domestic

MJIA
920(end of Mar. 2021)

Goal: Reach ¥ 5 trillion in
the mid-2020s
69

Investment/Financial Data, etc.

MITSUBISHI ESTATE CO., LTD.

70

Investment/Financial Data, etc.

1. Net Interest-Bearing Debt/EBITDA Ratio(Billions of yen)

11.0

2,500.0(Times)10.0
9.0

2,000.0
7.3
6.7
1,500.0

1,000.0

6.6

6.7
2,194.8
2,019.8

6.1

6.1

2,140.2
1,965.2

2,216.8
2,041.8

7.1

7.4

8.0
7.0

6.6
2,353.8

6.9
2,530.0
2,372.5

6.0
5.0
4.0

2,196.3

3.0
500.0

2.0
1.0

0.0

FY2018FY2019Net interest-bearing debt
Debt/EBITDA ratio (right axis)

MITSUBISHI ESTATE CO., LTD.

FY2020

FY2021

FY2022(E)0.0

Net interest-bearing debt
*after hybrid debt deductions
Debt/EBITDA ratio (right axis)*after hybrid debt deductions
71

Investment/Financial Data, etc.

2. Breakdown of Interest-Bearing Debt
(Billions of yen)

3,000

95.0%

96.1%

93.7%

96.4%

95.1%

93.4%

2,500

6.8

5.6
100.0

2,000

61.8%

28.0

10.2
8.3

1,500

100.0

9.5

35.0

53.1%
1,292.9

54.0%

1,261.9

1,072.3

7.2

60.1%

95.4%

93.6%

73.2%

69.7%

4.7

93.2%

4.5
100.0
76.2%

50.0

92.4%
50.0
1.9

100.0

2.0

100.0
83.2%

76.4%

1,523.0

1,428.5

1,406.0

1,450.7

1,563.2

1,208.8

0

Total

30%
250.0

250.0

250.0

250.0

215.0

747.2

701.5

685.2

653.0

612.7

603.8

558.9

577.1

595.7

FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

1,716.8

2,085.4

1,973.0

1,929.3

2,291.0

2,396.9

2,481.6

2,319.5

2,429.8

2,526.1

Straight bond

MITSUBISHI ESTATE CO., LTD.

Subordinated bondBank Loan

50%
40%

250.0

636.2

80%

60%

1,000

500

90%

70%

64.1%
1,381.2

100%

Subordinated loan

CP

Lease liability

Fixed ratio

20%
10%
0%

Long-term ratio

72

Investment/Financial Data, etc.

3. Interest-Bearing Debt: Procurement Interest Rates/
Average Duration of Interest-Bearing Debt (Unconsolidated)(Year)

10

2.5%

9

8.16

8
7
6
5

1.88%
5.91
1.42%

1.88%
1.72%
5.45
1.40%
1.27%

4
3

5.55

1.05%

5.58

5.45

1.54%

1.55%

0.72%

1
0

FY2010FY2011FY2012FY2013
Average duration of interest-bearing debt

MITSUBISHI ESTATE CO., LTD.

1.38%

1.52%

1.32%

7.23

0.96%
0.70%

0.62%

0.96%

1.5%
1.24%
1.14%

0.61%

FY2014FY2015FY2016
Bonds/Average interest

0.95%

0.66%

0.97%
0.75%

2.0%

6.69

1.07%

0.87%

2

6.18

1.41%
1.05%

1.01%

5.71

6.36

6.79

0.92%
0.71%

FY2017FY2018FY2019Bank loans/Average interest

0.84%
0.68%

1.09%
1.0%
0.78%
0.63%
0.5%

FY2020
FY2021
Total/Average interest

73

Investment/Financial Data, etc.

4. Segmentation Changes from April 1, 2020
Current Segments
Office Building Business
Lifestyle Property
Business
Residential Business
International Business
Investment Management
Business
Hotel & Airport BusinessArchitectural Design &Engineering Business①:Integration of
three businesses②:Integration of international
residential business into
International Business③:Integration of disclosure
segments

From FY2021
Commercial Property
Business
Residential Business
International Business
Investment Management
Business
Architectural Design &Engineering Business andReal Estate Services
Business
Other Businesses

Commercial Property
Business Group
Office Building Business
Outlet Mall Business
Retail Facility Business
Logistics Facility Business
Hotel Development Business
Hotel Operation BusinessAirport Operation Business

International
Business Group

Real Estate Services
Business

International Commercial Property

Other Businesses

International Residential BusinessBusiness<Purpose of Changes>① The Office Building, Lifestyle Property, and Hotel & Airport business units will be merged to strengthen capabilities for increasing cross-segment
projects.
② International Residential business will move from the Residential Business segment to the International Business segment to consolidate
international project expertise.
③ Architectural Design & Engineering Business, and Real Estate Services Business are integrated as Other Businesses for simplified disclosure.

MITSUBISHI ESTATE CO., LTD.

74

ESG Initiatives

For details of ESG initiatives in the "Long-term Management Plan 2030“, please refer to the following link.
https://www.mec.co.jp/e/investor/plan/pdf/plan200124_e.pdf
MITSUBISHI ESTATE CO., LTD.

75

ESG Initiatives

1. Materialities (Important Issues for Sustainable Management)
Identifying Opportunities and Risks for 7 Materialities'Materialities'

MITSUBISHI ESTATE CO., LTD.

Opportunities

Risks

Increasing need for acquisition and leasing ofreal estate with low environmental impact

Rising countermeasure expenses due to thestrengthening of environmental regulations
and stricter renovation standards

Expanding demand for facilities and services
that address the needs of international visitors

Increased country, compliance, and supply
chain risks

Heightening need for acquisition and leasing ofreal estate highly resilient to disasters, e.g.
earthquakes

Falling asset values and rising expenses formaintenance and countermeasures due toDisasters, e.g. earthquakes

Rising demand for facilities and services
tailored to diverse living and work styles

Declining demand for facilities and services
where the promotion of diversity is insufficient

Increasing demand for facilities and services
tailored to new needs arising from demographic
changes

Contracting demand for facilities and services
due to demographic changes (incl. thedecrease in working population)

Reduction in waste as a result of longer
demolition and rebuilding spansby making effective use of existing stock

Decreasing need for expensive, newly-built
real estate in comparison with pre-owned andolder properties

Improvements in the efficiency andconvenience of facility operations byleveraging IT and robots

Declining demand for facilities and services dueto the late response to IT and digital innovation

76

ESG Initiatives

2. Initiatives to Protect the Environment (The "E" in ESG)Key KPIs and Targets:■CO₂ emissions ■ Waste generated per unit of floor space ■ Renewable energy rate ■ Recycling rate
■Recycled water usage rate ■ Japan-grown timber usage rate

CO₂ emissions⁃ Increase electricity storage facilities⁃ Optimize thermal circulation⁃ Employ demand response system

2030 Target

35％ reduction (vs. FY2018)

2050 Target

87％ reduction (vs. FY2018)*Targets were approved by
SBT Initiative in April 2019

Actual: 3,533 thousand t (FY2021)

Recycling Rate
⁃ Raise awareness and distribute information fortenants, visitors, and guests⁃ Systems/measures to facilitate waste
separation

2030 Target

90％

Examples of initiatives taken
towards CO₂ emission
reduction and renewableenergy rates
From the fiscal year 2022 ending on March 19,
buildings in the Marunouchi and Yokohama
area will draw power from a renewableenergy power source. From this initiative, anestimated 180,000 tons of CO₂ will be saved.

Actual: 60.5％ (FY2021)

Reference value: 3,336 thousand t (FY2018)

Renewable energy rate
2030 Target
2050 Target

25％
100％

Actual : 3.1％ (FY2021)

MITSUBISHI ESTATE CO., LTD.

Waste generated per unit of floor space2030 Target

20％ reduction(vs. FY2020)

Actual value : 5.0kg/m2. (FY2021)

Marunouchi Bldg.

Yokohama Landmark Tower

77

ESG Initiatives

3. Initiatives for Human Resources and Resilience (The "S" in ESG)
＜Human Resources＞ Key KPIs and Targets＜Resilience＞ Key KPIs and Targets■ PTO utilization■ Rate of buildings that take in stranded commuters■ Paternity leave utilization■ Rate of people with first aid training course qualifications■ Retention post-parental-leave

PTO Utilization

Rate of Buildings Taking in Stranded
Commuters

FY2021 Goal

Actual (FY2021)

5％ increase*3Rate of such facilities

Reference value: 66.0% (FY2018)*1Actual: 59.8％ (FY2021)

Paternity Leave Utilization
FY2030 Goal

100％

*2Actual: 42.4％ (FY2021)

FY2030 Goal

Seismic Performance of New
Building (Marunouchi Area)

Rate of People with First Aid
Training Course Qualifications

FY2030 Goal

1.5×

100％

of a standard skyscraper(= withstand a level 7 earthquake)*4Actual: 63.0％ (FY2021)

Retention Post-Parental-Leave*5Emergency Generator for BCP
in New Buildings (Marunouchi Area)

100％

72 hr

*2Actual: 94.8％ (FY2021)*1 Mitsubishi Estate only

*2 Average of 5 companies (Mitsubishi Estate, Mitsubishi Estate Residence,

Mitsubishi Jisho Property Management, Mitsubishi Jisho Sekkei, Mitsubishi Real Estate Services)

MITSUBISHI ESTATE CO., LTD.

92.3％

*3 Covering large-scale properties completed in or after 2002

*4 Average of 3 companies (Mitsubishi Estate, Mitsubishi Jisho Property Management, Mitsubishi Jisho Retail Property

Management)*5 Certain exceptions withstand78

ESG Initiatives

4. Corporate Governance (The “G" in ESG) #1
Establish effective governance that ensures long-term enhancement of corporate values.
（as of Mar. 2021）

Corporate Structure• Transitioned to a “Company with Nominating Committee, etc.” in June 2016
• In 2020, an independent evaluation of the effectiveness of the Board was undertaken

Structure of the Board of Directors

Committee Members• 15 directors: 8 company directors and 7 independent outside
directors (10 of which are non-executive directors)• Chairpersons of all committees are independent outside directors• 6 of 7 independent outside directors are male and 1 is female

Board Structure

Composition of Male/Female
1

5

7
3

Company Director (Executive)
Company Director (Non-executive)
Independent/Outside Director (Non-executive)

MITSUBISHI ESTATE CO., LTD.

• Remuneration and Nominating Committees comprised ofindependent outside directors only
• With regards to the Audit Committee, two non-executive internal
directors, who are familiar with the company's business, wereappointed to ensure the effectiveness of audits
Audit
Committee

Nominating
Committee

Remuneration
Committee

Chairperson is an
outside director

Exclusively
outside directors

Exclusively
outside directors

14
Male

Female: Outside Director: Company Director(Non-executive): Chairperson

79ESG Initiatives

5. Corporate Governance (The “G" in ESG) #2
Strategic-Holding Stock Policies• Sold 20 *entities with a total value of approx. ¥20.7 bn in thepast three years (FY2019-FY2021)• As of March 2021, hold approx. ¥228.5 bn of stock value.
Routinely review strategic objectives and dispose of stocks asnecessary• Expect to sell approx. ¥10 bn in FY2022* Stocks of listed companies only. Including partial sale

170
160
150
140
130
120
110
100

Holdings of Shares Held Strategic Purposes(Total for Listed and Non-Listed Companies)
2

0
166

164

4

8

152

148

16

22

30

138

134

133

FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021
Non-new business-related holdings

New business-related holdings

The Executive Compensation Plan Aims to Align Shareholders and Executives’ Interests
Composition of Compensation
Base Salary50％
Fixed Component

Short-term Incentive

Medium- to
Long-term Incentive

Single-year
RS
PS
Performance-based
Incentive Incentive
Incentive

25％

12.5％

12.5％

Variable Component<Single-Year Performance-Based Incentives>
・Form: Cash・Calculation: "KPIs" : Operating profit, ROE, etc., of previous year (quantitative evaluation) as well as
levels of contribution to medium- to long-term business results, efforts in ESGs, and otherelements (qualitative evaluation)<Phantom Stock Incentives>
・Form: Cash・Performance evaluation period: About 3 years
・Calculation: Based on stock price and total shareholder return (TSR) relative to *peer companies<Restricted Stock Incentives>
・Form: stock
・Lock-up period: About 3 years* Nomura Real Estate Holdings, Inc., Tokyu Fudosan Holdings Corporation, Mitsui Fudosan Co., Ltd., Tokyo Tatemono Co., Ltd., and Sumitomo Realty & Development Co., Ltd

MITSUBISHI ESTATE CO., LTD.

80

ESG Initiatives

6. External Evaluations
As of August 2021, the following reputations or ratings have been given:• FTSE4Good Global Index (20 years in a row)
• FTSE Blossom Japan Index (Adopted by GPIF, 5 years in a row)
• MSCI Japan ESG Select Leaders Index (Adopted by GPIF, 5 years in a row)
• MSCI Japan Empowering Women Select Index (Adopted by GPIF, 4 years in a row)
• S&P/JPX Carbon Efficient Index (Adopted by GPIF, 4 years in a row)
• Dow Jones Sustainability Asia Pacific Index• Member of the "S&P Global Sustainability Yearbook 2021"• SOMPO Sustainability Index (10 years in a row)
• GRESB Public Disclosure (4 years in a row)
• GRESB Real Estate 2020:- GRESB Standing Investment Benchmark (Received 5 stars for existing property portfolios)- GRESB Development Benchmark (Received 4 stars for innovation and large-scale rennovation portfolios)• CDP Climate Change 2020 Assessment: A-rating• CDP Supplier Engagement: Leaderboard• 2021 Certified Health & Productivity Management Outstanding Organizations Recognition Program: Large
Enterprise Category, White 500

MITSUBISHI ESTATE CO., LTD.

81

Contact Information
Investor Relations Office,Corporate Communications Department
Mitsubishi Estate Co., LTD.
+81-3-3287-5200
https://www.mec.co.jp/<Disclaimer>
Information on the properties of this material is based on the judgments made from information available at thepresentation date of this material.
Please be aware that actual information can result in different results depending on various factors.

MITSUBISHI ESTATE CO., LTD.