FY2023

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/en/ir/plan2030/

Contents
Financial Overview

3

Summary of FY2023 Results

4

Summary of FY2024 Forecasts

7

Progress of Long-Term Management Plan

13

ESG Initiatives (Sustainability Initiatives)

26

Financial Supplemental Data

35

Business Overview

43

Commercial Property Business
Office Building46

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

58

Residential Business
International Business

65
70

Investment Management Business76

Investment/Financial Data, etc.

82

Overview of the "Long-Term Management Plan 2030"

87

Appendix.

94

MITSUBISHI ESTATE CO., LTD.

2

Financial Overview

Financial Overview＜FY2023 Results＞
 Record highs for operating revenue, operating profit, ordinary profit, and profit attributable to ownersof parent.
 Main factors of profit growth are capital gain increase and recovery from the impact of the COVID-19
on Retail Properties and Hotel Business.
 Main business topics•

The vacancy rate in Marunouchi has dramatically improved to 2.43% as of March 2023 (Domestic Asset)•

Completed “3rd MINAMI AOYAMA,” a new office building in Aoyama (Domestic Asset)•

Investment Management (IM) set new targets for FY2031, AuM ¥10 tr and operating profit ¥30 bn (Non-asset)＜FY2024 Forecasts＞
 Operating profit is expected to decline YoY due to decrease in capital gains in International Business,but profit attributable to owners of parent is expected to hit another high for three years straight
thanks to improvements in extraordinary items.
 Dividend forecast is ¥40 per share (up ¥2 YoY), expected to record high.

MITSUBISHI ESTATE CO., LTD.

3

Summary of FY2023 Results

MITSUBISHI ESTATE CO., LTD.

4

Summary of FY2023 Results

1. Income Statement Results for FY2023
Record highs for operating revenue, operating profit, ordinary profit, and profit attributable to owners of parent,
driven by International capital gains.
Millions of yen (rounded down)
FY2023
FY2022
ChangeResults
Results

Operating revenue
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other*
Elimination
Operating profit
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other*
Eliminations or corporate
Non-operating income(Share of profit of entities accounted forusing equity method)
Non-operating expenses
Ordinary profit
Extraordinary income
Extraordinary losses
Total income taxes
Profit attributable to noncontrolling interests

Profit attributable to owners of parent

1,377,827 1,349,489
777,424760,658
346,419
380,959
176,130
121,234
35,87846,702
72,57567,914(30,602)(27,979)
296,702
278,977
188,852
189,90935,03730,17389,40055,816
8,054
26,537
2,055
1,119(26,696)(24,578)
14,361
16,31928,337
16,766(34,540)
54,896(10,824)
4,660(2,622)
17,724(1,057)
4,863
33,583(18,483)936(2,118)(1,957)

260

332

(72)

39,244
271,819
12,224
31,141
70,634
16,924
165,343

41,586
253,710
20,18920,12070,88927,718155,171(2,341)
18,108(7,964)
11,020(255)(10,793)
10,171

Capital Gains included in Operating Profit
FY2023Results

Total
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other
Eliminations or corporate

296,962
279,310402,221381,434
2,871,677 2,738,632*Architectural Design & Engineering / Real Estate Service Business and Other businesses
MITSUBISHI ESTATE CO., LTD.

17,652
20,786
133,045

76,00042,0005,000
29,000-51,0000
19,00032,000-Operating Profit Variance by BusinessMillions of yen (rounded down)

Commercial
International IM & other
Property Residential
33,583(19,665)(1,057)
4,863
Increase in capital gains
Increase in capital gains

278,977

IM: Decrease in incentive fees

296,702

Reduced impact from COVID-19
Decrease in rental profit such as buildings being closed
Increase in expenses such as utilities

Millions of yen (rounded down)
FY2023
FY2022
ChangeBusiness profits
EBITDA
Interest-bearing debt

127,000
42,00024,00061,000-Millions of yen (rounded off
to the nearest billion)
FY2022
ChangeResults

FY2022
ResultCommercial
Property

Residential International IM & Others

FY2023Result5

Summary of FY2023 Results

2. Changes in Operating Revenue by Asset Type (Japan)
Continued to increase revenue significantly YoY at Hotels and Outlet Malls, as inbound tourism
recovers.
Office buildings*1

Retail properties, outlet malls, hotels, etc.
(Billions of yen)(Billions of yen)

Closure of retail properties
and hotels under SOEs

80
64.2
62.562.561.962.1
60.760.160.462.261.1

No
4th

preemergency
measures16.0

69.2*270

No Yes*3
2nd 3rd

Yes
1st

63.4
62.962.864.2
61.2

60

14.214.1
14.0
12.0

11.611.3

12.0

11.4

11.3

8.9

9.4 9.1

10.9

10.1

50

10.0

37.037.437.337.537.436.335.8 36.1
40
35.136.135.5
32.733.533.6
30.931.6

8.0

30

6.0

10.810.9
6.4 6.2

7.2

4.0

10

2.0

11.5 11.211.4

10.6
9.3

8.7

10.3
7.2

4.2

20 15.616.016.116.814.315.115.314.614.815.115.015.315.115.815.4 15.5

12.5

11.9

8.7

9.1 8.9

2.3

※4

6.2

6.6

9.3 9.0

4.8

4.2

5.7

8.4

9.8
9.4
9.1

2.3

2.7

3.3

3.4

0.8

0.0

0
20/3 20/3 20/3 20/3 21/3 21/3 21/3 21/3 22/3 22/3 22/3 22/3 23/3 23/3 23/3 23/3
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Marunouchi

Tokyo (excl. Marunouchi)

Outside Tokyo*1 Incl. revenue from office complexes and retail properties*2 One-time income from receipt of restoration construction costs, etc.

20/3 20/3 20/3 20/3 21/3 21/3 21/3 21/3 22/3 22/3 22/3 22/3 23/3 23/3 23/3 23/3
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Outlet malls
Others (stand-alone SC, logistics facilities, etc.)
Royal Park Hotels and Resorts

SOE declaration period(Areas and requests
differ each time)*3 Some outlet malls and retail properties only.

*4 Incl. operating revenue of Royal Park Hotel Co., Ltd. (former Hakozaki Company), since the Company took over the management business of former Hakozaki Company.

MITSUBISHI ESTATE CO., LTD.

6

Summary of FY2024 Forecasts

MITSUBISHI ESTATE CO., LTD.

7

Summary of FY2024 Forecasts

１. FY2024 Income Statement Forecasts（vs FY2023 Results）
Operating profit to decline due to reaction drop in International capital gains. Still the bottom line is expected to hit
another high for three years straight thanks to improvements in extraordinary items.
2024/3
Forecasts

Millions of yen (rounded down)

2023/3Results

ChangeOperating revenue
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other※
Elimination
Operating profit
Commercial Property BusinessResidential Business
International Business
Investment Management Business
Other※
Elimination or corporate
Non-operating income（Share of profit of entities accounted
for using equity method）
Non-operating expenses
Ordinary profit
Extraordinary income
Extraordinary losses
Total income taxes

1,469,000
836,000
381,000
158,000
43,00078,000(27,000)
264,000
188,000
36,00054,00012,0004,000(30,000)
11,0001,377,827
777,424
346,419
176,130
35,87872,575(30,602)296,702
188,852
35,03789,4008,054
2,055(26,696)
14,361

91,17358,576
34,581(18,130)
7,122
5,425
3,602
(32,702)(852)
963(35,400)
3,946
1,945
(3,304)(3,361)

300

260

40

43,000232,000
31,0005,000
79,00039,244
271,819
12,224
31,141
70,634

3,756(39,819)
18,776(26,141)
8,366

Profitable attributable to non-controllinginterests
Profit attributable to owners of parent

13,00016,924(3,924)

166,000

165,343657

2024/3
Forecast

Business profits
EBITDA
Interest-bearing debt

264,300
374,500
2,940,000

296,962402,221
2,871,677(32,662)(27,721)
68,323

Millions of yen (rounded off to thenearest billion)

2024/3
Forecast

94,00045,00019,00030,000Total
Commercial Property BusinessResidential Business
International Business2023/3Result-Investment Management Business
Other(Eliminations or corporate)

Change127,000
42,00024,00061,000(33,000)
3,000(5,000)(31,000)--

Operating Profit Variance by Business
Commercial
Property△852

296,702

Millions of yen (rounded down)
2023/3
ChangeResult※Architectural Design & Engineering / Real Estate Service Business and Other businesses

MITSUBISHI ESTATE CO., LTD.

Capital Gains included in Operating Profit

Millions of yen (rounded down)

Residential

963- Increase in capital gains- Recovery of hotels andretail properties- Decrease in rental profit
such as buildings being
closed- Increase in expenses
such as utilities

International△35,400

Others2,587

Decrease in capital gains

264,000

Increase in condominium sales
Decrease in capital gains
FY2023Resultコマーシャル
不動産事業

住宅

海外

投マネ・その他

FY2024
Forecast

8

Summary of FY2024 Forecasts

２. FY2024 Forecasts - Operating Profit Breakdown (vs FY2023 Results)
Operating profit to decrease YoY in reaction to the large capital gain recorded in International
Business previous year.
Operating Profit

296.7(Billions of yen)
Others(2.5)

Condominiums Commercial
+3.0
+7.2

Residence(5.0)

International(31.0)

127.0

9.8＋Increase in base fees
+Recovery of hotels and retail properties- Decrease in redeveloping buildingsʼ profit- Amortization of Regus Japan Goodwill- Increase in costs such as utilities

Operating
Profit264.0- Decrease in deemedtransfer gain in US

Capitalgain
Domestic
condo
etc.*

Commercial International
(3.9)
(4.4)

Investment
Management+3.9- Decrease because of reaction
to large properties sales

94.0＋Increase in sales

17.0

Income
gains

159.9

153.0
Income gains ▲6.9

FY2023ResultDomestic
condominiu
ms, etc.*+7.2

Capital gains ▲33.0

ChangeIncome gains

Domestic condominiums, etc.*

Capital gains

FY2024
Forecast* Excluding capital gains etc. in standalone operating profit of the Mitsubishi Estate Residence.
MITSUBISHI ESTATE CO., LTD.

9

Summary of FY2024 Forecasts

３. Cashflow Results for FY2023
Steady captured investment opportunities particularly overseas for Long-Term goals, though witha recognition lag in cash outflow partially.
Cash in(Initial
forecasts)
(870
~920)

FY2023
840

Financing arrangements（Increase in liabilities)
(150〜
200)

130

Cash out(Initial
forecasts)
(870
~920)

FY2023840(Billions of yen)

Strategic
allocation Share buyback

(100〜
150)

Nov. 2022 Announced share buyback amounting to ¥100 bn(By Mar. 2023: ¥45.8 bn completed, ¥54.2 bn remaining)

45

Strategic
35
investments

Feb. 2023

Acquired Regus Japan Holdings as strategic investment[Major investments in FY2023 (incl. newly made during period)]

Returns※1
(450)

440

Results

Investments
(720)

710

Cash flows fromoperating activities※2
(270)

270

Dividends(50)

50※1 Collection amount of book values from sale proceeds of properties ※2

MITSUBISHI ESTATE CO., LTD.

Marunouchi
Outlet Malls, etc
Domestic Condominiums
Domestic Capital Recycling
Overseas
Total

30
25
260
205
190
710

Initialforecasts
60
30
230
250
150
720

Change
(30)
(5)
+30
(45)
+40
(10)

Payout ratio: Approx. 30%
DPS: ¥38
Operating chashflows, excl. Change in inventories and change in equity investments

10Summary of FY2024 Forecasts

４. FY2024 Cash Flow Forecast
Continue to invest for profit growth and realizing the Long-Term goals, ensuring returns andeffective control of balance sheet. Seize new investment opportunities mainly in capital recycling
business globally.

■ Assumptions in Operating and Investing CFs(Billions of yen)

Cash in840

Cash out
830
Steady progress in investments in both
Japan and overseas

Returns※1
570

Cash flows fromoperatingactivities※3

270

Increase inreturns forcontrolling BS

At same level as year earlier

Investments※2680【Major investments】
Marunouchi
Outlet Malls, etc
Domestic Condominiums
Domestic Capital Recycling
Overseas

Strategic
Allocation
150

60
50
150
220
200

Continue to seek
new investments

FCF︓＋10※1 Collection amount of book values from sale proceeds of properties ※2 Investment amount for approved investment projects (partly incl. expected approvals)※3 Operating chashflows, excl. Change in inventories and change in equity investments

MITSUBISHI ESTATE CO., LTD.

11

Summary of FY2024 Forecasts

５. External Environment Analysis and Our Strengths
Changing External Environments
Japan

Overseas

Inflation

Rising construction and energy costs

Financial
Env.

Surging interest rates, Financial
uncertainties led by US bank failures

Monetary
PolicyGrowing anxiety at a policyʼs turning point

OfficeDemandMore flexible work styles as a threat
to office demand Growing uncertainty in real estatemarket worldwide

Status  Stagging real estate stock price as
Analysiswell as NAV discountOur Strengths
21Stable office rental profit
from Marunouchi (The areaʼsvacancy rate lowered to
2.4% at end of FY2023)

MITSUBISHI ESTATE CO., LTD.

3
Prime areas covered globally,
Capital recycling developedand expanded with various
assets, Diversified portfolio

Growing fee revenues around
Investment Management tobe less market-sensitive(Promoting Non-asset biz)12

Progress of the Long-Term Management Plan

For details of the "Long-Term Management Plan 2030", please refer to the following link.
https://www.mec.co.jp/en/ir/plan2030/
MITSUBISHI ESTATE CO., LTD.

13

Progress of the Long-Term Management Plan

1. ROA/ROE/EPS
FY2023 resulted in ROA 4.4%, ROE 7.9%, and EPS ¥125.54. EPS is expected to hit another high in
FY2024.
EPS（yen）

ROA、ROE（%）
12%

240
200

10%

10%
8.5%

8.1%

7.8%

8%

7.6%

7.3%
6.6%

6%

5.2%

5.6%

108.64
86.78

52.85
3.3%

60.13
3.3%

4.0%

116.45160

4.1%

130.085%

101.34

4.4%

120

4.4%

3.8%

74.00
3.6%

7.8%

125.54

96.97
4%

7.9%

200

3.8%

80

3.8%

2%

40

0%

0
FY2015FY2016FY2017FY2018FY2019FY2020EPS(right axis)
MITSUBISHI ESTATE CO., LTD.

FY2021*ROA

FY2022ROE

FY2023

FY2024(F)2030 Target* ROA = Business Profit / Total assets (average)

14

Progress of the Long-Term Management Plan

２. Shareholders Returns
Since the Long-Term Management Plan released, carried out shareholders returns in combination
with constant share buyback, and total shareholders return rate has largely increased.
 Dividend is FY2023:¥38 (+¥2 YoY), FY2024: ¥40 (+¥2 YoY); Expected to reach record high for three years straight.
 Shareholders returns: Constantly expanding since FY2020; A total of ¥230 bn share buyback decided.
 Total shareholders return rate*: Three-year average stays in mid-50% after the release; Stable/high-level shareholders returns
were implemented.
 Continue to consider share buyback, based on profit growth, stock price level, selective investment for profit growth, prospects
for return.
*The proportion of the sum of dividend and share buyback, out of profit attributable to owners of parent.

Profit(Billions of yen)

Dividends per share

(Yen)

180
160
140

31

26

100

12

40

12

12

12

16

120.4
102.6

64.2
11.9

12

14

134.6

56.5 45.5

0MITSUBISHI ESTATE CO., LTD.

64.2 73.3

83.4

166.0
165.3
155.1

148.4

20

80

20

33

30

120

60

38

36

135.6

40

45

160

40

140

35

120

30

100

25
20
15
10
5
0

（％）

(Billions of yen)
Dividend

100.0

Share buyback(3-year average)
52.7%

52.9%

80
60
40
20
0

60.0%

45.8
30.0

57.0%

54.2

46.1%

19.4

22.1

27.7

36.0

50.0%
40.0%

29.6%
26.3% 26.6% 27.8%

16.6

70.0%

additional return
59.3%

Total shareholders return rate

30.6%

80.0%

¥230 bn

30.0%

29.3%

20.0%
41.6

44.6

41.4

47.7

49.7

50.6

10.0%
0.0%

15

Progress of the Long-Term Management Plan

３. Domestic Asset Business #1 : Profit Trends
Capital gain returns exceeded expectations in each asset, while income gain temporarily affected by profit
decline of redeveloping buildings.
Business profit (LT plan) +50.0bn(Billions of yen)（vs FY2020 Forecast (¥201 billion))

250.0

215.8
201.5

201.6

33.0

39.0

215.2

215.3 +50 bn

Capital gains
 Possess ¥1.25 tn of assets as domestic capital recycling business(see next page for details)
 Continued to record high capital gains mainly from offices, logistics,
and rental apartments■Capital Gain Breakdown by Assets

200.0

150.0

14.7

16.7

47.0
25.3

66.0

60.0

64.0

40.0

9.8

17.0

10.0
20.0
0.0

100.0
153.8

145.9

143.4

139.3

33.0
8.0
15.0
FY2020
Office

134.3

39.0
7.0
8.0
24.0
FY2021
Logistics（billions of yen）

66.0

47.0

24.0

5.0
7.0

14.0

35.0

FY2022
Residential

28.0
FY2023

 Steadily disposed of inefficient assets
FY2020: Otemachi Park Building (partial ownership), Atagawa Villa Business
FY2021: Corowa Koshien Park, FY2022: Grand Loft Osaka (partial ownership)

50.0

Income gains

0.0
FY2020
Income gains

MITSUBISHI ESTATE CO., LTD.

FY2021

FY2022

FY2023 FY2024(F) Goals of

Domestic Condminium for sale

2030

Capital gains

 New building operations contributed to profit, whereas profit loss derived
from redevelopment of buildings, etc.
 As a result of travel restriction relaxation, COVID-19 recovery became
significant after 2H FY2023.

16

Progress of the Long-Term Management Plan

４. Domestic Asset Business #2
Capital recycling assets accumulated to ¥1.25 tn and recorded continuous and high-yielding capitalgains in various assets.
Capital Gains Results

Capital recycling assets status
Total BV of Domestic Assets in Capital Recycling:

FY2021

Approx. ¥1.25 tn at end of FY2023
Commercial Propertyʼs
Asset: ¥1.035 tn

Residentialʼs Asset:¥215 bn

6%
13%

78%

Rental Appartmetnts
Logistics

RetailHotelElderly homes, Student mansion■Link Square Shinjuku(partial ownership)■Toyosu Front(partial ownership)

Usage: Logistics
Total floor area:
297,000㎡

OfficeRetails
9%

MITSUBISHI ESTATE CO., LTD.

OperatingAssets66%
NOI yield
7%

Logistics

Hotels2%

Primary Disposed Properties■the ARGYLE aoyama
Usage: OfficeTotal floor area: 23,100㎡■Logista・LogicrossIbaraki Saito(Buildings A, B)【Residential Business】 Disposed of 4
properties, mainly rental apartments.

【Residential Business】 Disposed of 19
properties, such as residential apartments
and elderly homes.

Property Name

Commercial Propertyʼs NOI yield on Operating Asset

Logistics
0%¥66 bnOffice: ¥28 bn
Logistics: ¥14 bn
Residential: ¥24 bn

Usage: Logistics

Primary Transaction Casesof partially consolidated subsidiaries.

Office54%

FY2023

Usage: OfficeTotal floor area:
107,000㎡■Logiport Kawasaki Bay* Domestic rental etc. real estate excluding Marunouchi outlet and assets

Nonoperating
Assets34%¥47 bnOffice: ¥35 bn
Logistics: ¥7 bn
Residential: ¥5 bn

Primary Disposed Properties

Usage: OfficeTotal floor area: 44,000㎡

72%

FY2022

Primary Disposed Properties

28%

2%

Office¥39 bnOffice: ¥24 bn
Logistics: ¥8 bn
Residential: ¥7 bn

the ARGYLE aoyama
Toyosu Foresia
Shinjuku East Side Square
CIRCLES Hirakawacho
Toyosu Front
Grand Front Osaka
Link Square Shinjuku
Otemachi Park Building
Shinjuku Front Tower

Location
Minato, Tokyo
Koto, Tokyo
Shinjuku, Tokyo
Chiyoda, Tokyo
Koto, Tokyo
Kita, Osaka City
Shibuya, Tokyo
Chiyoda, Tokyo
Shinjuku, Tokyo

Property Name

Location

Logista・Logicross Ibaraki Saito (Building A)
Logista・Logicross Ibaraki Saito (Building B)
Logicross AtsugiⅡ
Logicross Yokohama Port North
Logiport Kawasaki Bay
Logicross Narashino
Logicross Nagoya Kasadera

Ibaraki, Osaka
Ibaraki, Osaka
Atsugi, Kanagawa
Yokohama, Kanagawa
Kawasaki, Kanagawa
Narashino, Chiba
Nagoya, Aichi

Total Floor
Area（㎡）
23,100101,500
170,200
1,100
107,000
484,300
43,800151,700
94,000Total Floor
Area（㎡）
108,500
31,10035,10016,400289,900
36,40072,400*1 Assumed
NOI
2.9% presented by
Japan Real
3.6%
Estate3.2% Investment
3.3%
3.8%
3.5~3.7%
4.0%
2.6%
3.8%

NOI（％）*1

NOI（％）*2
4.2%
4.3%
4.4%
4.1%
4.3%
4.3%
5.0%

*2 Assumed
NOI
presented by
Mitsubishi
EstateLogistics Reit
Investment

17

Progress of the Long-Term Management Plan

５. Domestic Asset Business #3
Capital recycling business progressed, and project lineup further expanded.
Category

Name (including tentative)

*1

Size

Tokiwabashi Tower (Building A)

146,000㎡

Uchi-kanda 1-Chome Project

85,200㎡

Yurakucho Building・Shin-Yurakucho Building
Marunouchi Redevelopment ProjectDoMixed use・m
OfficeesticOutlet mall

*2

*3

FY2022

FY2023

FY2024FY2025 FY2026

Torch Tower (Building B)

544,000㎡*3★

●
Under consideration★

●

9,400㎡

Under consideration

3rd MINAMI AOYAMA

14,700㎡★

Osaka Dojimahama Tower

67,000㎡★

Toyosu 4-2 Development Project

136,000㎡

Tenjin 1-7 Project (Fukuoka)

74,000㎡

●
●
★

●
★

●
Gradual completion andopeningGrand Green Osaka(Umekita Second) (Osaka)

378,450㎡

Nishiki 3-25 Development Project (Nagoya)

109,700㎡

Dogenzaka 2-chome South Redevelopment Project

87,100㎡★

●

Iidabashi Station East Redevelopment Project

46,500㎡★

●

Sannomiya Kumoi Dori 5-chome Redevelopment
Project (Kobe)
Former Hotel Grand Palace site Redevelopment
Project★

210,000㎡

FUKAYA HANAZONO PREMIUM OUTLETS ®

34,600㎡*3

Under consideration★
★

Under consideration

245,000㎡
205,000㎡

Logicross Zama

178,700㎡★

●

170,900㎡★

●

Misato-shi Hikoito Project
Kyoto Jyoyo Next-generation Core Logistics Facilities
Project (Kyoto)…Project announces after the Long-term Management Plan
*1 Includes properties expected to be sold by 2030

MITSUBISHI ESTATE CO., LTD.

★

43,500㎡
*3

Red

●

●

Tokyo Ryutsu Center Distribution A Building

Large-scale Logicross Sagamihara
Logistics Osaka City Suminoe Ward Shibatani(100,000㎡+) Freezed/Refrigerated Distribution Project (Osaka)

Approx. Approx.
¥75-80 ¥1.2-1.3
bn
tn●

6,600㎡

Akasaka 2・6-chome Development Project
KYOTO JOYO PREMIUM OUTLETS ®

●★

98,600㎡
*3

2030

●

10,700㎡

Kokusai Building・Teigeki Building Redevelopment
Project〜

NOI
Forecast Forecast(during investmen
stablet amount
operation)

●

★

●

54,000㎡

Under consideration

277,000㎡★

… Project added this quarter*2 Total floor area unless otherwise noted.

●★・・・Start Construction●・・・Completion*3 Site area18

Progress of the Long-Term Management Plan

6. International Asset Business #1 : Profit Trends
Realized steady profit growth in both income gains and capital gains.
In FY2023, expanded to approx. ¥90 bn (+¥54 bn) from FY2020 forecast (¥36 bn).
Business profit(long-term target) +¥50.0 bn(vs. initial forecast
for FY2020 (¥36.0 bn))

89.4

(Billions of yen)

80.0

Capital Gains Based on U.S. capital recycling business (¥10-20
bn/year) Aim for more growth by ongoing capital recyclingin Europe and portfolio expansion in Asia
■ Breakdown of Capital Gains by region

55.8

60.0

61.0

46.1
37.9

40.0

28.0

29.0

54.0

+¥ 50 bn

30.0

12.0

60.0

(Billions of yen)

61.0
39.0

40.0

28.0

20.0

16.0

12.0

12.0

12.0

18.0

22.0

FY2020

FY2021

FY2022

FY20230.0

USEurope

29.0
11.0

Asia

20.0

25.9

18.1

26.8

28.4

24.0

Income Gains Achieved profit growth through each area strategies

0.0
FY2020

FY2021

Capital gains
MITSUBISHI ESTATE CO., LTD.

FY2022

FY2023 FY2024(F) Goals of
2030
合計

U.S.A
Renewal of 1271AoA, hybrid model investment contribution
Europe Rich pipeline despite of reductions from sales and renovations
Asia
Expansion of residential business and development promotionin each area

19

Progress of the Long-Term Management Plan

7. International Asset Business #2
Investments on capital recycling business advanced in each area, and the asset have reached ¥950
bn (+¥100 bn YoY).
Capital Recycling Assets Status■Capital Gain ResultsBook Value of Overseas Assets in Capital Recycling Business*1

Based on the US capital recycling business (¥10-20 bn per year), capital gains in Asia and Europe sequentiallycontributed to profit as well.

Book Value End of FY2023: ¥950 bn

27%

FY2021US
46%

Mainly in US ¥12 bn

Europe*1 Inventory + Equity Investment + Fixed Asset*2 Excluding CORE Assets (Manhattan) presumed to be held

FY2022

US

Europe
10%

9%

7%

57%

Asia
7%

5%

41%

40%
78%

12%
Office・Mixed use

Logistics・Data Center

Rental appartment

Hybrid-model investment

Condominium

OthersMITSUBISHI ESTATE CO., LTD.

Middlesex
Location: New Jersey
Usage: Logistics
Size: 37,200㎡
EIRR︓Over 50%

In Europe and other areas ¥61 bn

12%
20%

Harvill
Location: California
Usage: Logistics
Size: 31,000㎡
EIRR: Over 100%
Capital Place
Location: Hanoi, Vietnam
Usage: Office
Size: 151,600㎡
EIRR: Over 30％

Asset Type per Area

2%

EdisonLocation: New Jersey
Usage: Logistics
Size: 83,600㎡
EIRR: Over 50%

In US logistics, Asia offices etc. ¥29 bn

Asia

27%

LIV North Valley
Location: Arizona
Usage: Rental apartment
Size: 385 units
EIRR: Over 30%

FY2023Central St. Giles
Location: London
Usage: Office
Size: 66,000㎡
EIRR: Over 10％

Hanover
Location: Pennsylvania
Usage: Logistics
Size: 42,100㎡
EIRR: Approx. 100％

Val Verde
Location: California
Usage: Logistics
Size: 26,900㎡
EIRR: Over 100％

Liv Crossroads
Location: Arizona
Usage: Rental apartment
Size: 356 units
EIRR: Approx. 30%

20

Progress of the Long-Term Management Plan

８. International Asset Business #3
Rich project lineup in each area. Understand the market and turn them into profit at the right time.
Category

O
v
e
r
s
e
a
s

Name (Including tentative)*1

Size*2

143,200㎡
Trinity Tower (Indonesia・Office, Retail)233,600㎡
Hangzhou ALPHA PARK (China・Office)93,400㎡
CapitaSpring (Singapore・Mixed use)
*3
55,000㎡
180 George Street (Australia・Office, Retail)116,000㎡
One City Centre (Thailand・Office, Retail)Asia
49,000㎡
The Grand Outlet（Indonesia・Outlet Mall）
65,900㎡
Parkline Place（Australia・Office, Commercial）
220,400㎡
Suzhou ALPHA PARK（China・Office）
86,800㎡
One Circular Quay（Australia・Hotel etc.）
307,000㎡
Oasis Central Sudirman（Indonesia・Mixed use）
29,000㎡
Warwick Court（London・Large-scale Renovation）
85,000㎡
8 Bishopsgate（London・Office, Commercial）
338 units
The Blossoms（London・Rental Apartment）*3
Europe dMoura1（Spain・Office）
11,000㎡*37,800㎡
Grace（Sweden・Large-scale Renovation）
60-72 Upper Ground（London・Office,*4
10,400㎡
Commercial）
Stateline 77 Building1/2（South Carolina・*3
93,600㎡
Logistics）*3
16,700㎡
55 Paradise （New York・Logistics）
Virginia Data Center（Buiiding1・Data Center）*5
51,000㎡
Virginia Data Center（Buiiding2・Data Center）
360 units
sol38 （Arizona・Rental Apartment）
250 units
PATTEN GRAY （Colorado・Rental Apartment）*3
49,300㎡
1072 West Peachtree （Georgia・Mixed Use）
*3
37,000㎡
600 Fifth Street NW （Washington D.C.・Office）
60,800㎡
Heritage,
Chula
Vista
(California・Logistics）
US
28,200㎡
Spotswood（New Jersey・Logistics）
28,200㎡
Paradigm RiNo (Colorado・Office）
13,600㎡
10 Constitution Ave（New Jersey・Logistics）
94,600㎡
Spartanburg 221（South Carolina・Logistics）
12,600㎡
Nellis Logistics Center（Nevada・Logistics）
13,500㎡
3102 N Lamb（Nevada・Logistics）
43,100㎡
16 Dupont（New York・Rental Apartment）
23,000㎡
Vista（Alabama・Rental Apartment）
23,600㎡
E 2nd Martin（Colorado・Rental Apartment）… Project announces after the
Red… Project added this quarterLong-term Management Plan

MITSUBISHI ESTATE CO., LTD.

FY2022 FY2023 FY2024 FY2025 FY2026

〜

2030

Forecast NOI(Under Stable
Operation)

Forecast
Investment
AmountApprox. ¥40
bn

Approx. ¥500
bn

●
●
●
●
●
★

●

★

●
★

●

★

●
★

●

●
●
●
●
★

●
●

●
★

●
★

●
★

●

★

●
★

●
★

●
★

●

★

●
★

●

★

●
●
●
●

★
★
★
★
★

●
●
●

★
★

*1 Includes properties expected to be

sold by 2030

★・・・Start Construction●*2 Total floor area

unless otherwise noted.

●・・・Completion*3 Leasable Area

*4 Site Area

※5 Total of two buildings

21

Progress of the Long-Term Management Plan

9. Non-asset (Fee-based) Business : Profit Trends
Released new targets for FY2031 in Investment Management Business. Business environmentfor Hotel has improved since the 2H of FY2023.
Business profit(long-term target) +¥50.0 bn(vs. initial forecast
for FY2020 (¥16.0 bn))

(Billions of yen)

60.0

Investment Management Business■Increased base income from AuM expansion• Increased base fees as AuM expands, pushing the business profit toward ¥10 bn.
• Achieved mid-2020s target (¥5 tn) sooner than expected. Set new targets for FY2031 as
AuM ¥10 tn and operating profit ¥30 bn.
(Trillions of yen）

50.0+¥ 50.0 bn

32.2
40.0

25.0
12.3

30.0
20.0
10.0
0.0
-10.0

15.7

19.0

9.3

11.7
26.5

12.2

10.7

4.4

5.9

(0.9)

(7.3)

(6.7)

FY2021

FY2022

FY2020IM Business
MITSUBISHI ESTATE CO., LTD.

Hotel

11.7

Domestic

¥５ tn

4.5

5.4

3.1

3.7

1.4
1.7

1.7
2.0

2.4

3.2

2.1

2.2

FY2021

FY2022

FY2023 2Q

At the annoucementof the Long-Term
Management Plan
(January 2020)10

Mid-2020s target
International

AuM Target■Recorded unrealized incentive fees from value-add funds

1.3• FY2022 recorded incentive fees (appx. ¥18.5 bn) to reflect gains on RE market value ofvalue-added funds in US etc.
• FY2023 reduced the above incentive fees to reflect market as impacted by interest rateincrease n US etc.

12.0

8.0
(0.6)

10
8
6
4
2
0

Hotel Business
FY2023

FY2024(F)

Other

2030
Targets

 In FY2023 business environment has improved and businessrecovery will continue in FY2024
FY2021-FY2022 widened loss due to COVID-19.
FY2023 showed sharp recovery since October as travel restrictions eased.
Inbound tourism is recovering as well.

22

Progress of the Long-Term Management Plan

10. Progress of Non-Asset Business #2
IM: Now targeting AuM ¥10 tn & OP ¥30 bn in FY2031■Set new targets for FY2031■Back on track with OCC & ADR at pre-COVID level

Having achieved AuM ¥5 tn sooner than initially targeted mid-2020s, set new
targets of AuM ¥10 tn and Operating Profit ¥30 bn for FY2031.
With base fee income reaching some ¥10 bn, continue to grow AuM by acquiringproperties and establishing funds by leveraging our global strengths and analysis.
JRE

MJIA

Domestic

the U.S.

EuropeInternational

Hotel Management: On recovery from COVID-19

Asia & Oceania

Though heavily impacted by COVID-19, FY2023 showed clear recovery in both
OCC (Occupancy Rate) and ADR (Average Daily Rate). In March 2023, OCC
exceeded 80% and ADR reached approx. ¥20,000 at almost pre-COVID level.
FY2024 foresees more revenue by recovering tourism especially from China.
ADR

20,000

RevPAR

OCC

15,000

40
450
350
1,020

Target¥10 tn

1,100

Total
¥5.4 tn

Total
1,000 ¥3.6 tn

49.5%

10,000

53.1%

65.9%

60.0%

49.9%

20.0%
0.0%

0
1Q

FY2031
AuM: ¥10 tn (Target)
OP: ¥30 bn (Target)■Launched core OEF in Asia & Oceania andthe new global platform brandLaunched Core Open-End Fund in Asia & Oceania starting Oct. 2022 following
Japan, US, and Europe. Now able to meet various demands of investors worldwide.
To grow even faster, launched Mitsubishi Estate Global Partners, MEGP, as a global
platform brand of Investment Management Business where the Companyʼslocations in JP/U.S./EU/Asia can work together. Enabled one-stop service for crossselling various lines of products globally. Aim for further growth by building
stronger relationship with institutional investors.

80.0%

40.0%

2Q

3Q

FY2021

MITSUBISHI ESTATE CO., LTD.

48.9%

61.1%

4.7%

700

FY2022
AuM: ¥5.4 tn
OP: ¥8.0 bn

42.8%

63.7%

74.1%

22.4%

5,000
1,100

2,550

FY2020
AuM: ¥3.6 tn
OP: ¥4.4 bn

100.0%
78.4%

200

4Q

1Q

2Q

3Q

FY2022

4Q

1Q

2Q

3Q

4Q

FY2023■Opened The Royal Park Hotel Canvas Ginza Corridor
Grand opened in Nov. 2022 as the 19th Royal
Park Hotel. “Get intoxicated” as its concept,
committed to the greatest nightlife and staying
experience in Tokyo that fits Ginza Corridor
Street, offering a variety of entertainments
such as drinks, music, lights, and foods. HighOCC since opening as entry restriction eased.

■Hotel outline
Address: Ginza, Chuo-ku, Tokyo
Facilities: 161 guest rooms, one restaurant, three bar lounges
Site area: 701.45m2
Hotel floor area: 7,304m2
Scale: 13 floors above ground, one floor below

23

Progress of the Long-Term Management Plan

11. Investment Returns in FY2021-FY2023
Captured new investment opportunities domestically and overseas toward the Long-Term goal.
Promoted capital recycling and balance sheet control through portfolio strategy-based returns.
3-year Returns

3-year Investments

Plan

ActualPlan

1,200~1,300

1,310

2,100
Strategic Allocation(billions of yen)

ActualAnnounced ¥130bn share buyback
Share Buyback 75
in 3 years

2,110(New investments, additional
return, or debt repression)

600
Base return

Base + New

Base return

1,100

ベース回収
1,190

Portfolio
strategy-based

Portfolio
strategy-based*

100〜200

120

Base Investments
1,500*Including Otemachi Park Building disposal done after
FY2020 long-term plan release.

Marunouchi

・Base returns up following capital gain increase
・Sold partial ownership of Grand Front Osaka etc.,
following Otemachi Park Building in FY2020 in thecourse of portfolio strategy.

Outlet malls etc.*
Domestic recycling etc.
Domestic condominiums
Overseas

Total
MITSUBISHI ESTATE CO., LTD.

Investments
ベース投資
2,035
（including
M&A）

Total Investment
per Asset
140

120
705
570
500
2,035

Seized investing
opportunities
worldwide*Including M&A

24

Progress of the Long-Term Management Plan

12. Efforts to Improve Social Value
Set new GHG emission reduction targets(Declaration of Net Zero)
Substantially accelerated RE100 achievement timeline.
Overview of GHG reduction targets◆Meet the 1.5°C scenario of SBTi (The Science Based Targets
initiative) and review in accordance with the new net-zerostandard announced by SBTi. Certified as the first company inJapan by SBTi in June 2022.
“New Mid- and Long-Term Reduction Targets: relative to base year
(FY 2020) emissions,
FY2031: Reduce the sum of Scope 1 and 2 by at least 70% andScope 3 by at least 50%.
2050: Achieving Net Zero.

Compliant with new SBT net zero standard (1.5°C scenario)
New Mid- and Long-Term
Reduction Targets / Scope 1, 2

New Mid- and Long-Term
Reduction Targets / Scope 3

476 thousand
tons

Reduction
within thevalue chain(VC)
More than
70%

RE100
Aiming toAchieve

FY20262050
Net Zero

Scope2︓Indirect emissions from the use of electricity,heat, and steam supplied by other companies”
87.7%【Emissions】 Use of electricity【Measures】 Switch to renewable electricity”

Scope3︓Indirect emissions other than Scope 1 and 2【Emissions】①Future emissions by asset sales*3（ Approx. 36％,
Category 11）②Emissions by capital investment（ Approx. 43％, Category 1~3）
【Measures】 ①Reduction through reduction of Scope2②Identification of GHG emissions during the production of construction
materials, and reduction through the use of low-carbon materials”

Accelerate introduction of renewable energy to achieve RE100
2050
Net Zero
VC reduction
Over 90%

VC reduction
Over 90%

NeutralizationLess
than10%◆Following Otemachi, Marunouchi, andYurakucho areas, switch to renewableenergy-derived power for officebuildings and retail properties, owned inTokyo and Yokohama (including plans).
◆Introduced in approximately 50
buildings by FY2023.

FY2031

Neutralization
2050

MITSUBISHI ESTATE CO., LTD.

50%

Neutralization
Less than10%

FY2026FY2020

Reduction

3,560 thousand within VC
tons
More than【Measures】 Expectations for new energy and new technologies* Calculation: Floor space sold x Emissions per m2 in the previous year (Scope 1+2) X 50 years

By FY2031

By FY2031◆Breakdown of GHG emissions and major reduction policies (FY2022 Actual)
4.8%
Scope1︓Direct emissions by companies themselves
7.5%【Emissions】 Use of gas

FY2020

FY2031◆Renewable electricity rate is expected
Neutralization to increase to 50% by FY2023. Aiming
to achieve RE100 by 2025.
2050

Renewable electricity rate and targets
100%

100％

80%
Approx.
50％

60%
40%
20%
0%

31%

1.1% 3.1%
FY20

FY21

FY22

FY23
（F）

FY26
(Target)25

ESG Initiatives (Sustainability)

For details of ESG initiatives in the "Long-term Management Plan 2030“, please refer to the following link.
https://www.mec.co.jp/en/ir/plan2030/
MITSUBISHI ESTATE CO., LTD.

26

ESG Initiatives (Sustainability Initiatives)

1. Materialities / Material Issues for Sustainability Management
Mitsubishi Estate Group
Sustainability Vision 2050

Be the Ecosystem Engineers
We aspire to be a corporate group (=engineers) that provides spaces andinfrastructure (=ecosystems) where all actors (individual, corporations, andmore) are able to coexist sustainably and thrive together economically,
environmentally, and socially.

Mitsubishi Estate Group 2030 Goals for SDGs

ʻMaterialitiesʼ

Globality

Community
Diversity
Declining Birthrate/
Aging Population
Leveraging Existing
Population

Digital Innovation

MITSUBISHI ESTATE CO., LTD.

Formulation of key themes and KPIs based on our materiality

Environment

Backcasting

Sustainable urban development that proactively addresses climatechange and environmental issues①

Environment②

Diversity&
Inclusion③

Innovation④

Resilience

•
•
•
•

CO2 emissions reduction (compared to FY2020)
2030 : Reduce Scope 1+2 by at least 70% and Scope 3 by at least 50%(2050 : Net zero achieved (Certified first in Japan by SBTi in June 2022.))
Renewable electricity rate: 100% by 2025 (joined RE100 in January 2020)
Waste recycling rate: 90%, Waste disposal: 20% reduction (compared with FY2020 /㎡)
Promote sustainable timber use

Urban development that responds to lifestyle and human resource
trends and facilitates active participation for all•••

Female managers: over 20% by FY2031, over 30% by FY2041, over 40% by
FY2051
Strengthen hospitality and realize stress-free cities
Respect different lifestyles, local customs, religions, and sexual orientation
Establish traceability of timber to be used in business activities

Innovative urban development that continuously renews society••

Innovate business models and maximize performance
Support the creation of new ideas and businesses from the perspective of
urban development and contribute to the growth of cities and industries

Dynamic, flexible urban development that builds disaster-resilient
communities and prioritizes safety and security••

Enhance disaster preparedness to minimize functional stagnation during disasters
Enhance BCP function through hardware measures and strengthen neighborhood
communication

27

ESG Initiatives (Sustainability Initiatives)

2. 2030 KPIs and Progress (The “E” & “S” in ESG)

1

2

Environment

Benchmarks
GHG emissions

FY2022 Actual

Benchmarks

2030 KPIs

FY2022 Actual

Scope1,2︓70% or more
Scope3︓50％ or more（vs FY2020)*

2,534 thousand t(Reference value:
4,038 thousand t)

Percentage of female
managers

Over 20%*

6.6%

Percentage of female newgraduate hires

40% every
year

38.3%

Rate of use of male
employees taking childcare
leave of absence

100%

75.5%

Benchmarks

2030 KPIs

FY2022 Actual

Percentage of employeeswith first aid provider
qualification

100%

72.4%

Percentage of buildingsthat are to take instranded commuters *

ー

100%

(FY2026)*

per m2
Waste disposal

vs. FY2020
20% reduction

5.1kg(Reference value:
7.1kg)

Waste recycling
rate

90%

58.4%

100%

31%

4

Innovation

Benchmarks

Initiatives

Diversity & Inclusion

2030 KPIs

Renewable
electricity rate

3

*New targets due to KPI review in FY2022• Maximize performance by innovating
business models• Support the creation of new ideas andbusinesses from the perspective of urban
development and contribute to thegrowth of cities and industries
See page 32 for details.

Resilience*Large properties completed in 2002 or later are eligible
MITSUBISHI ESTATE CO., LTD.

28

ESG Initiatives (Sustainability Initiatives)

3. Recent Highlights (The “E” in ESG)

1

Environment

Obtained ZEB Ready Certificate First among Office
Buildings in (tentative name) Uchi-Kanda 1-Chome ProjectIn the (tentative) Uchi-Kanda 1-Chome Project to becompleted in November 2025, obtained “ZEB Ready(office part),” first among tall tenant office buildings.
Following this property, will aim for ZEB-level
environmental performance in newly developing
buildings.
Continue to aim for energy consumption performance
improvement through demonstration experiments ofenergy saving measures that manage both energy
efficiency and comfortability, and implementations on▲ (tentative name) Uchi-Kanda 1new and existing buildings.
Chome Project
Scheduled to be completed in
2025/ZEB Ready【ZEB Definition】
Term

Definition“ZEB”

Energy consumption net zero or less
0% or less vs convention throughenergy saving + energy creation

Nearly ZEB

Buildings infinitely close to ZEB
25% or less vs convention throughenergy saving + energy creation

ZEB Ready

Advanced energy saving buildings
oriented to ZEB
50% or less vs convention throughenergy saving

ZEB Oriented

Buildings oriented to ZEB Ready
40% or less vs convention throughenergy saving in offices*Acronym for Net Zero Energy Building
MITSUBISHI ESTATE CO., LTD.

【List of ZEB-certified properties(including planned)】 Since issuing a Green Bond in June 2018, first by domestic RE developers, has
procured ¥236.5 bn through ESG financing. Will continue to utilize various
ESG finance methods to meet social demands.

Procurement Results through ESG Finance
Issue Monthand YearType of bond

Procureme
nt Amount

June 2018

Green Bond (public issue)¥20 bnMay 2020

Sustainability Link Loan

¥11.5 bnNovember 2021

Positive Impact Finance¥5 bn

July 2022

Sustainability Link Bond

¥60 bnOctober 2022

Sustainability Link Loan

¥50 bnMarch 2023

Sustainability Link Loan

¥30 bnMay 2023

Sustainability Link Bond

¥60 bn The Sustainability Link Bond issued July 2022 won Gold Award in the Fourth EAS

Finance Awards Japan Fundraising Part hosted by the Ministry of the Environment.

▲Logicross Zama
Komatsubara
Completed 2022/”ZEB”▲Shimojishima Airport
Tourist Terminal
Completed 2019/ZEB
Ready

Accelerated ESG Finance reflecting social demand.
Won Gold Award in ESG Finance Awards Japan.

▲Akasaka 2,6-Chome Area
Development Project
Scheduled for completion in
2028/ZEB Oriented (scheduled
for certificate)【Reasons for Selection】
・Issue of ultra long-term bond considering long-termbusiness model・Goal settings actively incorporating new SBTi net zerostandards, diversity, etc.

29

ESG Initiatives (Sustainability Initiatives)

4. Recent Highlights (The “E” & “S” in ESG)

2

Diversity ＆ Inclusion
Changes in targets and numbers for
improvements in female participation rate*2

Female new graduate hires (%)

Female employees at
assistant manager level (%) *2

Female managers (%) *1(Ref) Female employees
in all employees (%) *2※All figures are as of the beginning of each FY.

50.0%
40.0%

37.8%

37.8%

22.9%

24.3%

24.6%

15.9%

16.9%

5.7%

31.4%

30.0%
20.0%
10.0%
0.0%

FY2019

KPI

38.3%
26.0%

20.3%

21.1%

5.5%

5.8%

6.6%

FY2020

FY2021

FY2022①

Percentage of female managers*1: over 20% by FY2031, over 30% by
FY2041, over 40% by FY2051②

Ratio of female new graduate hires*2: 40% annually■Initiatives
•
•
•
•
•

Enhanced personnel systems to create a better working environments for women
Enhanced mid-career recruitment at the section manager level
Launched woman empowerment working group
Conducted social events for female employees
Conducted seminars on women's health in management training programs.

Supplier Code of Conduct
Established the Mitsubishi Estate Group Supplier Code of Conduct on April 1,
2022 to promote sustainability and ESG-related initiatives throughout our
supply chain.
As challenges like human rights, labor and climate change grow serious, thecode clearly states compliance requirements in our group's operations
toward our mission "Realizing Sustainable and Profound Valuable Society.“
Conducting a survey using interview sheets to check the status of Supplier
Code of Conduct compliance.
For time being, the survey will cover "contractors" and "cleaning
companies" which tend having higher sustainability risks* in our supply
chain," and will be extended further in the future.
Conduct surveys not only of primary suppliers (direct suppliers) but also of
secondary and subsequent suppliers (subcontractors of suppliers), identify
potential risks, and invite relevant suppliers for improvement initiatives.
■Implementation Status in FY2023
Starting in FY2022, distributed supplier code of conduct with quotation forms
to construction and cleaning companies and made supplier code of conduct
compliance rules in the quotation forms. Surveys have been conducted for
60 companies (43 construction companies including first to third tiersuppliers and 17 cleaning companies including first to second tier suppliers)and found zero violations related to compliance rules.
To accurately understand sustainability promotion status in suppliers,
interviewed workers in the supplier construction companies after survey andplan to interview cleaning companies as well. Will improve supply chain
management by considering problem-solving measures based on theactualities of suppliers.

*1 Scope of targets changed to Mitsubishi Estate in conjunction with their upward in FY2022.
*2 Mitsubishi Estate
MITSUBISHI ESTATE CO., LTD.

30

ESG Initiatives (Sustainability Initiatives)

5. Recent Highlights (The “E” and “S” in ESG)

3

4

Innovation

Open innovation through business supporting facility operation
Initiated venture company supporting organizations since 2000 and developing/operating
business supporting facilities for domestic and overseas growing companies, centered on
Marunouchi. Supporting growth of start-up companies from both the tangible (creating
places for gathering and communication) and the intangible (encouragement ofcommunication) aspects.
Recently, progressing joint research with academic facilities such as the University of Tokyo,
Tokyo Medical and Dental University, Tokyo University of the Arts, and Hitotsubashi
University, and seeking innovation creation through cooperation and industry and academia.

【Start-up business supporting facilities】
November 2022
Finished renewal

Cooperation
with Academia

Resilience

Demonstration experiment of “Hazard Dashboard Beta+”
As an initiative for disaster prevention in the Marunouchi area, created public-private
partnerships and conducted demonstration experiment of “hazard dashboard Beta+”, acooperative platform for sharing information in case of hazard and collects/broadcasts
information for refugees and stranded commuters.
【Main Points of the “Hazard Dashboard Beta +” demonstration experiment】
1. Hazard dashboard Beta+ Digital map version
・Created a digital version of “disaster evacuation site guide map” deployed by the
Chiyoda ward
・Provided information on stranded commuter accommodation facilities to refugees etc.
soon after disaster etc.
2. Integration of the digital map version in the Marunouchi area
・Display QR code of digital map version; integration with apps around Tokyo Station
3. Live footage accumulation, composition, and broadcast
・Trial manufactured a composition device that synthesizes etc. footage from live
cameras・A system for accumulating and broadcasting live footage using YouTube etc.
・Implementation demonstration of live cameras in night and bad weather.
4. Mass broadcast training to digital signs etc.
・Broadcasted live footage etc. to approx. 100 digital signs in the Marunouchi area

Tokyo
StationTorch Tower（To open in
FY2028）Opened in January 2022
▲Digital map version

MITSUBISHI ESTATE CO., LTD.

▲QR code displayed in station
facilities etc. (illustration)▲Scene of live footage composition(illustration)

31

ESG Initiatives (Sustainability Initiatives)

6. Corporate Governance (The “G” in ESG) #1
Establish effective governance that ensures long-term enhancement of corporate values.

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• Increased independent outside director rate for management
audit and monitoring enforcement
14 directors: 7 company directors and 7 independent outside
directors (10 of which are non-executive directors)• Chairpersons of all committees are independent outside directors• 5 of 7 independent outside directors are male and 2 are female
Board Structure

Composition ofMale/Female

From June 29, 2023 (Planned*)

5

7

4

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

MITSUBISHI ESTATE CO., LTD.

• 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

From June 29, 2023
(Planned*)

Nominating
Committee

Audit
Committee

Remuneration
Committee

2

Exclusively
outside directors

Chairperson is an
outside director

Exclusively
outside directors

73• Remuneration and Nominating Committees comprised ofindependent outside directors only

3

12
Male

Female*If the directors selection proposal isapproved in the annual shareholders'meeting on June 29, 2023

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

32

ESG Initiatives (Sustainability Initiatives)

7. Corporate Governance (The “G” in ESG) #2
Strategic-Holding Stock Policies• Sold 29 *entities (entirely sold 16) with a total value of approx.
¥34.8 bn in the past five years (FY2019-FY2023)• Approx. ¥253.6 bn (market value) of listed stock as of March 31,
2023. Routinely review strategic objectives and dispose of stocks
as necessary* 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

FY2015164

FY2016

4

8

152

148

FY2017FY2018

16

22

30

34

41

138

134

133

129

127

FY2019FY2020

FY2021

FY2022

FY20223

Non-new business-related holdings

New business-related holdings

The Executive Compensation Plan Aims to Align Shareholders and Executivesʼ Interests*Revised as of April 1, 2022.

Composition ofCompensation

Short-term Incentive(40%)(Expansion of evaluation items linked to LT management plan 2030.）

Base Salary40％
Fixed Component

Single-year Performancebased Incentive

30％

Medium- to
Long-term Incentive (30%)
RS Incentive
20％
Variable
portion10%

Fixed
portion10%

PS Incentive

10％

Variable Component<Single-Year Performance-Based Incentives : 30%>
 Form: Cash Calculation: "KPIs" : Business profit, EPS, ROA, ROE etc., of previous year (quantitative evaluation)
as well as levels of contribution to medium- to long-term business results, efforts in ESGs, andother elements (qualitative evaluation)<Phantom Stock Incentives : 10%>
 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 : 20%>
■Form : Stock■Lock-up period︓Up to the time of retirementof a director or officer*The evaluation method for the variable
portion is the same as for performance-linked
cash compensation.

* 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.

33

ESG Initiatives

8. External Evaluations
As of December 2022
Category― Not selected
Benchmarks

2020

2021

2022

Remarks

ESG in General

FTSE4Good Global Index

●

●

●

21 years in a row

ESG in General

FTSE Blossom Japan Index (Adopted by GPIF)

●

●

●

6 years in a row

ESG in General

MSCI Japan ESG Select Leaders Index (Adopted by GPIF)

●

●

●

6 years in a row

ESG in General

Dow Jones Sustainability World Index

―

―

●

ESG in General

Dow Jones Sustainability Asia Pacific Index

●

●

●

3 years in a row

ESG in General

Member of the "S&P Global Sustainability Yearbook"

●

●

●

3 years in a row

ESG in General

SOMPO Sustainability Index

●

●

●

11 years in a row

ESG in General

GRESB Public Disclosure

A

A

A

６ years in a row

ESG in General

GRESB Standing Investment Benchmark

5 Star

5 Star

5 Star

ESG in General

GRESB Development Benchmark

4 Star

5 Star

4 StarE (Environment)

S&P/JPX Carbon Efficient Index (Adopted by GPIF)

●

●

●

E (Environment)

CDP Climate Change

A

A-

A

E (Environment)

CDP Water Security

―

A-

A-

S (Society)

MSCI Japan Empowering Women Select Index (Adopted by
GPIF)

●

●

●

MITSUBISHI ESTATE CO., LTD.

5 years in a row

5 years in a row

34

Financial Supplemental Data

MITSUBISHI ESTATE CO., LTD.

35

Financial Supplemental Data

1. Management Index, etc.
①KPI for 2030 Target
2020/32021/32022/32023/32024/3（F）

2030(Target)

ROA*1

4.1%

3.8%

4.4%

4.4%

3.8%

5％

ROE

8.5%

7.6%

8.1%

7.9%

7.7%

10％

EPS

¥ 108.64¥ 101.34¥ 116.45¥ 125.54¥ 130.08¥ 200

2020/32021/32022/32023/32024/3（F）¥ 240.9 bn¥ 224.7 bn¥ 279.3 bn¥ 296.9 bn¥ 264.3 bn¥ 350.0〜
400.0 bn

Domestic AssetBusiness¥ 201.5 bn¥ 201.6 bn¥ 215.8 bn¥ 215.2 bn¥ 215.3 bn

Approx. ¥50 bn+*3

International
Asset Business¥ 46.1 bn¥ 37.9 bn¥ 55.8 bn¥ 89.4 bn¥ 54.0 bn

Approx. ¥50 bn+*3

Non-asset
Bussines¥ 15.7 bn¥ 9.3 bn

¥ 32.2 bn¥ 19.0 bn¥ 25.0 bn

Approx. ¥50 bn+*3

Eliminations or
corporate(¥ 22.4 bn)(¥ 24.2 bn)(¥ 24.5 bn)(¥ 26.7 bn)(¥ 30.0 bn)-②Business Profit

Business
profit*2*1 ROA = Business Profit / Total assets (average)

MITSUBISHI ESTATE CO., LTD.

*2 Business Profit = Operating Profit + Share of profit of entities accounted for using equity

2030(Target)*3 vs FY2020

36

Financial Supplemental Data

2. Balance Sheet : As of March 31, 2023
Millions of yen (rounded down)

Current assets

As of
As of
March 31, March 31,
2023
2022

Change1,616,602 1,356,789

259,813Millions of yen (rounded down)

Liabilities
Current liabilities

As of March As of March
31, 2023
31, 2022

Change4,492,017

4,257,484

234,532

855,337

631,043

224,293

Cash and deposits

225,011233,117(8,105)66,40760,516

5,890

Trade notes, accounts
receivable and contract assets

Trade notes and accounts
payable69,98760,645

9,342

Short-term borrowings

194,881

182,052

12,829Real estate for sale

65,252

41,23924,013210,087

79,928130,158

Real estate for sale in progress

420,956

299,532

121,424

Current portion of longterm borrowings
Current portion of bonds
payable26,63590,000(63,365)

719

724

(5)

357,326

218,544

138,781

Equity investments

716,416

624,52191,895

3,636,680

3,626,441

10,238820,584

786,335

34,249Other

118,256

97,00921,249Long-term borrowings

1,618,019

1,598,562

19,4575,255,356 5,137,127

118,228

Other

1,198,070

1,241,539(43,466)

4,416,214 4,345,989

70,224

Net assets

2,379,941

2,236,432

143,509

Shareholdersʼ equity

1,399,299

1,335,024

64,274

Accumulated othercomprehensive income

758,261

668,200

90,061

Share acquisition rights

193

201

(8)

Real estate for development

Non-current assets
Total property, plant andequipment

Other
Non-current liabilities
Bonds payable

Total intangible assets

111,187

108,092

3,095

Investment securities

306,352

299,617

6,734

Other

421,599

383,426

38,173

Non-controlling interests

222,187

233,005(10,818)

6,871,959 6,493,917

378,042

Total liabilities and net assets

6,871,959

6,493,917

378,042

Total assets

MITSUBISHI ESTATE CO., LTD.

37

Financial Supplemental Data

3. Consolidated Cash FlowMillions of yen (rounded down)①FY2022
Results
Cash Flows From
Operating Activities②FY2023
Results

Change（②－①）③FY2024
Forecasts

Change（③－②）

280,090269,914(10,175)

328,000

58,086

Depreciation

91,581

93,4591,877

96,0002,541

Decrease (Increase) ininventories

116,993

7,462(109,531)

151,000

143,538

Decrease (Increase) in equity
investments(30,267)(5,399)24,867(92,000)(86,601)(313,778)(312,046)

1,731(318,000)(5,954)

9,562

7,717

(1,844)(329,115)(286,523)

42,592(424,000)(137,477)

Cash Flows From
Financing Activities

90,97330,457(60,516)(42,000)(72,457)

Cash and Cash Equivalents
at End of Period

234,244

225,772(8,472)

190,000(35,772)

Free Cash Flow

(33,687)(42,132)(8,444)10,00052,132

Cash Flows From
Investing Activities
Proceeds from sales ofinvestment securities
Purchase of property, plant andequipment

MITSUBISHI ESTATE CO., LTD.

38

Financial Supplemental Data

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

450.0

424.0
331.8
10.7
12.3

300.0
250.0

201.0

200.0

45.0

400.0
350.0

Major Breakdown of Equity Investments

4.3

113.8

319.8

329.1

8.1
25.2

4.3
6.1

286.5

47.4

112.5

5.2
22.6

70.6

200.0
39.9

150.0

47.8
100.0

15.6
23.9

50.0

63.5

14.0
30.0

76.9
19.2
72.4
FY2021*

150.3
150.0

94.0

61.0

56.3

90.0

100.0

99.4
2.3

93.7

2.1

83.9

51.0
77.4
14.2

39.6
16.2

27.0

63.6

52.6

58.0

FY2023

FY2024(F)FY2022

2.0

3.0

99.0

75.1

50.0

93.9

1.1

101.0

49.0
60.7

8.8
13.2

42.6

FY2020

FY2021*0.0

0.0
FY2020

50.0

52.4
19.3
2.8
FY20222.0
FY202327.0
20.0
FY2024(F)*Classifications have been changed below from FY2021<Legend for FY2021 - ><Legend for FY2020>
Office Building (MEC: New/Redevelopment)

Office Building (MEC: Refubishment)

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 (includind consolidated eliminations)

New Investment

Others(including consolidated eliminations)

New Investments

MITSUBISHI ESTATE CO., LTD.

39

Financial Supplemental Data

※Ref. Supplementary information on investment assumption（vs FY2024 Forecast）
Consistency of investment prediction on the previous page and FACTBOOK Investment Data (p7).
Of the strategic allocation, ¥95 bn will be used for new investments under the initial assumption.
(Billions of yen)

Cash flow prediction in IR
materials
Strategic
Allocation
150

Investment assumptionin FACTBOOK
Total
775

95

(New Investment) 50

Domestic
Condominiums, etc.

(New Investment) 45

150(“Inventories”)(New Investment) 50

EquityInvestment
201【Major investments】
Marunouchi
Outlet Malls, etc
Domestic
Condominiums
Domestic Capital
Recycling
Overseas60
50

Investment(New Investment) 45

※

680

150
220
200

Of the strategic allocation, ¥95
bn will be for new investments

CAPEX
424

FACTBOOK
Data（p7）※ Investment in confirmed projects (included potential investments)

MITSUBISHI ESTATE CO., LTD.

40

Financial Supplemental Data

5. Income Generating Assets : Current Status #1
Increased unrealized gains due to lower cap rates on Marunouchi office buildings anddomestic rental apartment as well as foreign exchange rates.
Income Generating Assetsʼ Unrealized Gain
(Billions of yen)Book value

9,000
7,941.1

8,000
7,000

8,270.8

8,840.4

8,964.4

8,361.2

3,422.8

3,898.4

4,222.5

4,250.2

4,573.2

4,633.8

3,935

3,500

3,606

3,241
2,950
2,643

2,500

3,000

2,000
3,828.4

3,960.5

4,042.7

4,048.3

4,110.9

4,267.1

4,330.6
1,500

1,000
0

4,167

3,504

3,000

4,000

2,000

Adjusted BPS

4,000

6,791.9

2,963.5

BPS

(Yen)
4,500

7,383.4

6,000
5,000

Unrealized gain

BPS and Adjusted BPS*

1,148

1,224

1,276

1,296

FY2018FY2019FY2020

1,383

1,515

1,664

1,000
FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

FY2017

FY2021

FY2022

FY2023＊ BPS including unrealized gains (after tax)

MITSUBISHI ESTATE CO., LTD.

41

Financial Supplemental Data

6. Income Generating Assets : Current Status #2

Unrealized Gain Breakdown

Rental Profit(Billion of yen)
190

International
12%

180

Domestic(Outside of Marunouchi)
16%

Marunouchi
Redeveloped building*
51%

180.2

FY2020

FY2021

184.3
177.5

174.8
168.3

170
160

180.5

160.7

150
140

Marunouchi
Existing Building
21%

130
120
(FY2023 Results)

110
100
FY2017FY2018FY2019FY2022

FY2023*Redeveloped properties after the completion of Marunouchi Building
Since the fiscal year ended March 2022, the entire TOKYO TORCH PJ has
been counted as a Marunouchi new building.

MITSUBISHI ESTATE CO., LTD.

42

Business Overview

MITSUBISHI ESTATE CO., LTD.

43

Business Overview

1. Mitsubishi Estate Groupʼs 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.

＜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.

Residential Business

International Business

Investment Management
Business

Architectural Design &Engineering and Real Estate
Service 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

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.

44

Business Overview

2. Business Scale

Investment*OtherManagement
4%
Business
3%

Investment
Management
Business
2%

International
Business
13%

International
Business
28%

Operating Revenue¥1,377.8
Residential
Business
25%

billionInternational
Business
19%

Commercial
Property
Business
55%¥296.7billionResidential
Business
11%

Total Assets

Operating Profit

Approx.

Approx.

Investment
Management *Other
1%
Business2%*Other
1%

Approx.

Commercial
Property
Business
58%

Residential
Business
12%¥6,871.9
billionCommercial
Property
Business
66%*Architectural Design & Engineering Business and Real Estate Services Business, Others（FY2023 Results）

MITSUBISHI ESTATE CO., LTD.

45

Commercial Property Business
Office Buildings

MITSUBISHI ESTATE CO., LTD.

46

Commercial Property Business (Office Buildings)

1. Marunouchi Area Map

MITSUBISHI ESTATE CO., LTD.

47

Commercial Property Business (Office Buildings)

2. Pipelines
Marunouchi Area

FY2020(Building A)

FY2023

FY2024(Tentative name)Uchikanda

FY2026

Torch Tower(Building B)

1-Chome Project

Project MovieFY2028
Yurakucho Redevelopment(building number TBD)

A short movie
introducing
TOKYO TORCH
https://www.youtube.com/watch?v=stqH3DtOJ1M

Total floor area: 180,900㎡ Total floor area: 146,000㎡
Completed: Sep. 2020 Completed: Jun. 2021
FY2021

Link Square Shinjuku

FY2022(Tentative name) Nishiki 3-Chome

Total floor area: 67,000㎡
Completed: Apr. 2024

MITSUBISHI ESTATE CO., LTD.

FY2022

Total floor area: 139,600㎡
Completed: Jan. 2020

FY2021

Osaka Dojimahama
Tower

Total floor area︓85,200㎡
Completed: Nov. 2025

CO･MO･RE YOTSUYA

Total floor area: 43,800㎡
Completed: Aug. 2019
FY2020Outside of Tokyo

FY2022

Tokiwabashi Tower

Mizuho Marunouchi Tower, Ginko
Kaikan,Marunouchi Terrace

FY2020Tokyo(Outside of
Marunouchi)

FY2021

25th City Block Project

Total floor area: 109,700㎡
Completed: Mar. 2026

Total floor area: 544,000㎡
Completed: FY2028

FY2023

FY2024(Tentative name)Toyosu 4-2 Project

3rd MINAMI AOYAMA

Total floor area: 14,700㎡
Completed: Feb. 2023
FY2023

FY2026

Total floor area: 136,000㎡
Completed: Jun. 2025

FY2024FY2026FY2028(Tentative name)Akasaka
2 ・ 6-chome Development Plan

Total floor area: 210,000㎡
Completed: FY2029
FY2028

Tenjin 1-7 Project

Kobe Sannomia Kumoi-Dori
3-Chome Redevelopment

GRAND GREEN Osaka

Total floor area: 74,000㎡
Completed: Mar. 2026

Total floor area: 98,600㎡
Completed: FY2028

Total Completion: FY2028(Tentative name)(Umekita Second Project)48

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

4,660

4,500
4,000 3,684 3,696

3,825 3,907

4,175

4,896

5,580 5,670

5,038

5,174

5,385

5,570

5,745

2,565 2,565

1,677

1,798

1,946 2,024

500

256

256

355

489

2,687 2,758 2,755

2,195 2,258

2,583 2,531

2,727 2,784

1,897

489

2,915 2,915 2,952 3,026 2,920

1,705 1,705

1,500
1,000

5,804 5,743

3,769

3,000

2,000

5,991 6,040

4,347

3,500

2,500

5,869

743

743

1,022 1,022

1,174

1,836 1,836 1,872

1,987 1,987

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

0

Total (Domestic)

Marunouchi

Marunouchi Redeveloped Buildings*Excluding floor space in Lifestyle Property Business from FY2016

MITSUBISHI ESTATE CO., LTD.

49

Commercial Property Business (Office Buildings)

4. Earnings Related Data: Vacancy Rates and Average Rents
Vacancy Rates (Tokyo central 5 wards（Market） vs. Marunouchi Offices & All uses in Japan (Unconsolidated))and Average Rents (All uses in Japan) (Unconsolidated)(yen / tsubo-month)

Vacancy rate (Unconsolidated︓All uses in Japan)

30,0009.19%

26,00024,86423,56024,0003.59%

23,974 23,850 23,861

2.89%

18,000
2.77%

2.72%

3.58%

2.06%

2.80%

2.80%
2.42%

1.80%

1.37%

2.50%

2.19%

1.82%
1.65% 1.78%
1.87%

0.55%

12,000

3.50%

2.93%
2.22%

4.00%

3.33% 3.73%

3.60%

1.09%

14,000

7.00%

6.41%

5.00%
4.34%

3.58%

2.42% 2.26%

8.00%

5.42%

5.30%

2.42%

1.68%

28,228

6.37%

3.66%

2.86%

26,193

27,177

3.00%

3.29%

2.35%

2.00%

2.43%

1.50%
1.07%
0.69%

1.00%

0.19%

06/3

07/3

08/3

09/3

10/3

11/3

12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

22/3

23/3

Source: Miki Shoji Co., Ltd. and MECʼs property data
MITSUBISHI ESTATE CO., LTD.

9.00%

6.00%

4.32%

3.98%

25,842

26,702

27,793

23,587

5.29%

3.40%

25,2346.70%

21,711 21,733

3.41%

16,00024,42310.00%
29,221 29,000

8.56%

6.05%

22,60220,000

9.04%

8.75%

28,00022,000Vacancy rate (Unconsolidated︓Marunouchi offices)
Average rent (Unconsolidated︓All uses in Japan)

Vacancy rate (Market︓TC5W)

32,000

24/3
(F)

0.00%

50

Commercial Property Business (Office Buildings)

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

FY2022
Results

FY2023
Previous
Forecasts

FY2023Results

Rent revenue from office buildings*

435.2

425.0

427.4

Changes from the previous period+ 17.1(10.2)(7.7)

Rent revenue from new buildings+ 16.0

+ 6.2

＋5.8

(6.7)

(9.4)

(9.3)

Termination of master lease,closure of building for redevelopment

(3.4)

(8.4)

(8.1)

Moving in/out of tenants,
Rent revisions at lease renewal

(3.3)

(1.0)

(1.2)

+ 7.8

(7.0)

(4.2)

Rent revenue from existing buildings

Supplementary revenue, incl. common
area charge・Others* Office buildings, incl. those with retail areas, etc.

MITSUBISHI ESTATE CO., LTD.

51

Commercial Property Business (Office Buildings)

6. Earnings Related Data: 【New Format】
Office Building Business, Revenue Breakdown *1(Unconsolidated)(Billions of yen)
Revenue from office buildings
FY2023Results

FY2022
Results

Changesfrom theprevious
periodNewbuildings

Existingbuildings

Buildings
closureExpenses*2

ProfitChangesfrom theprevious
periodChangesfrom theprevious
periodRevenue from office bldg.

427.4

435.2

(7.7)

6.9

(5.2)

(9.5)

(5.4)

(13.1)

Marunouchi

253.0

256.7

(3.6)

6.3

(5.3)

(4.7)

(3.6)

(7.2)

Tokyo (excl. Marunouchi)

121.0

126.7

(5.7)

0.3

(1.9)

(4.0)

0.1

(5.6)

53.3

51.7

1.6

0.2

2.0

(0.6)

(1.8)

(0.2)

Of which, increase/decrease of rental revenue

(3.4)

5.8

(1.2)

(8.1)

Outside of Tokyo

Revenue from office buildings
FY2024
Forecasts

FY2023Results

Changesfrom theprevious
periodRevenue from office bldg.

427.9

427.4

Marunouchi

254.4

Tokyo (excl. Marunouchi)
Outside of Tokyo

ProfitChangesfrom theprevious
periodChangesfrom theprevious
periodNewbuildings

Existingbuildings

Buildings
closure

0.4

2.8

6.1

(8.3)

(7.4)

(7.0)

253.0

1.3

0.6

7.7

(6.9)

(4.0)

(2.7)

120.4

121.0

(0.6)

2.4

(1.7)

(1.2)

(1.7)

(2.3)

53.0

53.3

(0.3)

(0.2)

0.1

(0.2)

(1.7)

(2.0)

(3.7)

2.0

1.8

(7.6)

Of which, increase/decrease of rental revenue*1 Office buildings, incl. those with retail areas, etc

MITSUBISHI ESTATE CO., LTD.

Expenses*2*2 (minus) indicates an increase in expenses

52

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

1.21

Historical average supply
Approx. 1.09 million ㎡/year(2000-2021)

1.19

0.72
0.5

1.41
1.28

1.17

0.91

1

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

0.87

0.86 0.85

0.77
0.65

1.19

1.09

0.58

0.97

0.85
0.69

0.74

0.61

0.71

0.48

0

*Forecast*Research subject buildings: Buildings with a total office floor area exceeding 10,000㎡
Source: Mori Building (as of May 2022)
MITSUBISHI ESTATE CO., LTD.

53

Commercial Property Business (Office Buildings)

8. 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.

54

Commercial Property Business (Office Buildings)

9. Competitive Edge of Marunouchi: Number of Headquarters and Offices(as of March 2022)③ Number of Companies Listed on the First
Section of the Tokyo Stock Exchange① Fortune Global 500 company headquarters

118

MARUNOUCHI

20

3

2

0

0

NIHONBASHI

89
37

TORANOMON36SHIBUYAMARUNOUCHINIHONBASHISHINAGAWA

SHIBUYATORANOMON33SHINAGAWA② Top 50 company headquarters in terms ofmarket capitalization④ Foreign financial company offices

72

MARUNOUCHI

13
5
MARUNOUCHINIHONBASHI

2

1

SHINAGAWATORANOMON0SHIBUYA17

NIHONBASHI

6SHIBUYASHINAGAWA

MITSUBISHI ESTATE CO., LTD.

19

TORANOMON

055

Commercial Property Business (Office Buildings)

10. Marunouchi Data: Marunouchi Office Tenant Mix (Unconsolidated)
March 2000

Type of Business

Area ratio

March 2023

Type of Business

Area ratio

1

Manufacturing

42.5%

1

Finance24.3%

2

Finance22.2%

2

Manufacturing

23.0%

3

Trading

10.4%

3

Professional Firm

16.5%

4

Information

6.3%

4

Information

10.9%

5

Professional Firm

4.4%

5

Trading

9.2%

Others

14.2%

Others16.1%

Contracted area
Approx. 835 th m2（office）

Contractedarea（office）

Approx. 1,526 th m2

Others 16.1%
Finance24.3%
Others 14.2%
Professional Firm
4.4%
Information
6.3%
Trading
10.4%

Trading
9.2%

March 2000
Contracted area

Finance 22.2%

MITSUBISHI ESTATE CO., LTD.

Approx.

Approx.

835 th m2

March 2023
Contracted area

Manufacturing
42.5%

Information
10.9%
Professional Firm
16.5%

1,526 th m2
Manufacturing
23.0%

56

Commercial Property Business (Office Buildings)

11. 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.

Hotels57

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

MITSUBISHI ESTATE CO., LTD.

58

Commercial Property Business (Outlet Malls)

1. Outlet Mall Business #1
Store Area,
Operating Revenue & Operating Profit

Sales-linked & Fixed Rent Ratio(average of all facilities)(㎡)(Millions of yen)

400,000

50,000

50%

47%

38%

38%

40%

300,000

50%

53%

62%

62%

60%

250,000

FY2019FY2020

FY2021

FY2022

FY2023350,000

45,00040,00035,000

Fixed rent

30,000200,000

25,000150,000

ROA & Total Assets(Billions of yen)

20%

18.0%

100,000

20,00050,00010,000

0

18/3

19/3

20/3

21/3

22/3

23/3

308,500 314,600 315,300 345,500 345,500 373,100

Operating Revenue 45,462 46,659 46,393 40,030 44,177 51,069
Operating Profit

MITSUBISHI ESTATE CO., LTD.

18,940 19,673 18,963 14,619 16,789 19,257

150

17.3%

15%
15,000Store area

Sales-linked rent

12.6%

13.6%

14.7%
100

10%

50

5%

0
FY2019FY2020

FY2021

FY2022

Total Asset (right axis)

ROA

FY202359

Commercial Property Business (Outlet Malls)

2. Outlet Mall Business #2

Sendai-Izumi

Kyoto Joyo
Tosu
GOTEMBA PREMIUM OUTLETS®

Name

Kobe-Sanda
Rinku

FUKAYA - HANAZONO PREMIUM OUTLETS®

Location

Site Area

Total Floor Area Store Floor Area Number of Stores

Hanazono Sano
Toki

Ami
Gotemba Shisui

Schedule

GOTEMBA PREMIUM OUTLETS®

Gotemba, Shizuoka

419,200㎡

70,400㎡

61,300㎡

290

Open: Jul. 2000, Phase2 expansion: Jul. 2003, Phase3 expansion: Mar. 2008,
Phase4 expansion: Jun. 2020

RINKU PREMIUM OUTLETS®

Izumisano, Osaka

130,300㎡

64,900㎡

50,200㎡

250

Open: Nov. 2000, Phase2 expansion: Mar. 2002, Phase3 expansion: Dec. 2004,
Phase4 expansion: Jul. 2012, Phase5 expansion: Aug. 2020

SANO PREMIUM OUTLETS®

Sano, Tochigi

174,600㎡

39,900㎡

37,300㎡

180

Open: Mar. 2003, Phase2 expansion: Jul. 2004, Phase3 expansion: Mar. 2006,
Phase4 expansion: Jul. 2008

TOSU PREMIUM OUTLETS®

Tosu, Saga

134,200㎡

36,800㎡

31,700㎡

170

Open: Mar. 2004, Phase2 expansion: Dec. 2007, Phase3 expansion: Jul. 2011,
Phase4 expansion: Nov. 2019

TOKI PREMIUM OUTLETS®

Toki, Gifu

283,700㎡

41,300㎡

35,100㎡

180

Open: Mar. 2005, Phase2 expansion: Oct. 2006, Phase3 expansion: Jul. 2010,
Phase4 expansion: Nov. 2014

KOBE-SANDA PREMIUM OUTLETS®

Kobe, Hyogo

316,800㎡

49,600㎡

42,100㎡

210

Open: Jul. 2007, Phase2 expansion: Dec. 2009, Phase3 expansion: Dec. 2012

SENDAI-IZUMI PREMIUM OUTLETS®

Sendai, Miyagi

43,700㎡

20,300㎡

15,200㎡

80

Open: Oct. 2008

AMI PREMIUM OUTLETS®

Inashiki, Ibaraki

211,100㎡

34,700㎡

30,600㎡

160

Open: Jul. 2009, Phase2 expansion in Dec. 2011

SHISUI PREMIUM OUTLETS®

Inba, Chiba

421,000㎡

47,300㎡

42,100㎡

220

Open: Apr. 2013, Phase2 expansion: Apr. 2015, Phase3 expansion: Sep. 2018

FUKAYA-HANAZONO PREMIUM OUTLETS®

Fukaya, Saitama

197,700㎡

34,600㎡

27,500㎡

130

Open: Oct. 2022

(Tentative name) KYOTO JOYO PREMIUM
OUTLETS® Project

Joyo, Kyoto

245,000㎡--

MITSUBISHI ESTATE CO., LTD.

-

Scheduled to open at the same time as the opening of the neighboring roads.

60

Commercial Property Business (Logistics Facilities)

3. Logistics Facility Business #1
Capital Gain on Sales

Total Assets(Billions of yen)
14.0

14.0

12.0
10.0
8.0

8.0

6.0
4.0
2.0
0.0

8.0

Approx. ¥Approx. ¥

27 bn

7.0

development64%（2 buildings)(8 buildings)
FY2020

FY2021

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

＜End of March 2023＞

Assets inOperation
36%
Assets under

4.0
FY2019＜End of March 2020＞

FY2022

FY2023113 bnAssets inOperation
13%（3 buildings)

Assets underdevelopment
87%(13 buildings)*Ratio by value*Excl. Tokyo Ryutsu Center

Logicross Zama Komatsubara

Logicross Zama

61

Commercial Property Business (Logistics Facilities)

4. Logistics Facility Business #2
Completed properties
Name

Location

Logicross Atsugi
Logicross Kobe Sanda
Logicross Narashino
Logicross Osaka
Logicross Nagoya Kasadera
LOGIPORT Kawasaki Bay
Logicross AtsugiⅡ
Logicross Yokohama Kohoku
Logista・ Logicross Ibaraki Saito A Building
Logista・ Logicross Ibaraki Saito B Building

Projects under development

Total Floor Area

Completion

Appraisal NOI Yield

Atsugi, Kanagawa
29,900㎡
Mar. 2017
4.5%
Kobe, Hyogo
12,900㎡
Jun. 2017
5.1%
Narashino, Chiba
36,400㎡
Mar. 2018
4.3%
Osaka, Osaka
36,600㎡
Sep. 2018
4.3%
Nagoya, Aichi
72,400㎡
Jan. 2019
5.0%
Kawasaki, Kanagawa
289,900㎡
May 2019
4.3%
Atsugi, Kanagawa
35,100㎡
Jul. 2019
4.4%
Yokohama, Kanagawa
16,400㎡
May 2019
4.1%
Ibaraki, Osaka
108,500㎡
May 2021
4.2%
Ibaraki, Osaka
31,100㎡
Apr. 2021
4.3%*Excerpts from major transactions only
*Appraisal NOI yields are values announced Mitsubishi Estate Logistics REIT Investment Corporation.

Name

Location

Tokyo Ryutsu Center Distribution A Building

Ota, Tokyo

Logicross Zama
Logicross Sagamihara

Site Area

Total Floor Area

Construction
BeginsCompletion-

205,000㎡

Dec. 2021

Aug. 2023

Zama, Kanagawa

80,900㎡

178,700㎡

Apr. 2022

Nov. 2023

Sagamihara, Kanagawa

78,100㎡

170,900㎡

Jun. 2022

Dec. 2023(Tentative name)Osaka Suminoe Shibatani Freezing andOsaka, Osaka
Refrigeration Logistics Project

21,500㎡

43,500㎡

Spring 2023

Spring 2025

(Tentative name) Kyoto Joyo Core Logistics Facility

119,000㎡

277,000㎡

2025

2026

Joyo, Kyoto

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

Logicross Sagamihara

62

Commercial Property Business (Hotels)

5. Hotel (Development/Operations) Business #1 (Non-asset Business)
Royal Park Hotels and Resorts
Operating profit

Royal Park Hotels
Number of Rooms (published projects)（Billions of yen）

（rooms）
4,920

3,399
2,434

2,434

3,815

4,129

4,415

1.4

0.5

0.5

2,809

-0.6

-0.9

FY2017FY2018FY2019FY2020-7.3
FY2021-6.7
FY2022

FY2023

FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024

Hotels opened in each period
FY2019FY2020

FY2021

FY2022

FY2023

3 bldgs

2 bldgs

2 bldgs

2 bldgs

2 bldgs• Kyoto Shijo• Hiroshima
RS• Ginza 8
The Royal Park Hotel Iconic Kyoto

MITSUBISHI ESTATE CO., LTD.

• Osaka
Kitahama• Osaka
Midosuji• KobeSannomiya• KyotoUmekoji• Kyoto Nijo
• Sapporo
Odori Park

• Iconic Kyoto• Ginza
Corridor

The Royal Park Hotel Canvas
Fukuoka Nakasu

63Commercial Property Business (Hotels)

6. Hotel (Development/Operations) Business #2
Hotel Management Business （Non-asset Business）

Information Movie

Guidance Video Of Royal Park Hotels

NameRoyal Park Hotel
Yokohama Royal Park Hotel
Sendai Royal Park Hotel
The Royal Park Hotel Iconic Tokyo Shiodome
Marunouchi Hotel
The Royal Park Hotel Fukuoka
The Royal Park Hotel Kyoto Sanjo

https://www.youtube.com/watch?v=pMD89uhfPbg

The Royal Park Canvas Nagoya
The Royal Park Hotel Tokyo Haneda
The Royal Park Hotel Kyoto Shijo
The Royal Park Hotel Hiroshima Riverside
The Royal Park Canvas Ginza 8
The Royal Park Canvas Osaka Kitahama
The Royal Park Hotel Iconic Osaka Midosuji
The Royal Park Canvas Kobe Sannomiya
The Royal Park Hotel Kyoto Umekoji
The Royal Park Canvas Kyoto Nijo
The Royal Park Canvas Sapporo Odori ParkThe Royal Park Hotel Iconic Kyoto
The Royal Park Hotel Canvas Ginza Corridor
The Royal Park Hotel Canvas Fukuoka Nakasu
The Royal Park Hotel Iconic Nagoya

LocationChuo, Tokyo
Yokohama, Kanagawa
Sendai, Miyagi
Minato, Tokyo
Chiyoda, Tokyo
Fukuoka, Fukuoka
Kyoto, Kyoto
Nagoya, Aichi
Ota, Tokyo
Kyoto, Kyoto
Hiroshima, Hiroshima
Chuo, Tokyo
Osaka, Osaka
Osaka, Osaka
Kobe, Hyogo
Kyoto, Kyoto
Kyoto, Kyoto
Sapporo, Hokkaido
Kyoto, Kyoto
Chuo, Tokyo
Fukuoka, Fukuoka
Nagoya, Aichi

アセットブック更新後、更新内容を貼り付け

The Royal Park Canvas Sapporo Odori Park

MITSUBISHI ESTATE CO., LTD.

Open

419
603
110
490
205
174
172
153
313
127
127
121
238
352
170
246
180
134
125
161
255
250

Jun. 1989
Sep. 1993
Apr. 1995
Jul. 2003
Oct. 2004
Jul. 2011
Oct. 2011
Nov. 2013
Sep. 2014
Apr. 2018
Oct. 2018
Mar. 2019
Jun. 2019
Mar. 2020
Jan. 2021
Mar. 2021
Jun. 2021
Oct. 2021
Apr. 2022
Nov. 2022
Aug. 2023
Feb. 2024

Hotel Development Business （Domestic Asset Business）
Name

Hilton Okinawa Miyakojima Resort

Number of Rooms

Number of Rooms

Construction Begins

Open

The Royal Park Hotel Kyoto Shijo (MJ HOTEL Kyoto Shijo)

Kyoto, Kyoto

Location

127

Jul. 2016

Apr. 2018

MJ HOTEL Asakusa
The Royal Park Hotel Canvas Kobe Sannnomiya (MJ HOTEL
Kobe Sannomiya)
The Royal Park Hotel Kyoto Umekoji (MJ HOTEL Kyoto Umekoji)
MIMARU TOKYO ASAKUSA STATION (MJ HOTEL Asakusa
Kaminarimon)
The Royal Park Canvas Sapporo Odori Park (MJ HOTEL Sapporo
Odori Park)
Hotel Okura Kyoto Okazaki Bettei (MJ HOTEL Kyoto Okazaki)

Taito, Tokyo

166

Mar. 2017

To be determined

Kobe, Hyogo

170

Sep. 2019

Jan. 2021

Kyoto, Kyoto

246

Jun. 2019

Mar. 2021

Taito, Tokyo

51

Dec. 2019

Apr. 2021

Sapporo, Hokkaido

134

Mar. 2020

Oct. 2021

Kyoto, Kyoto

60

Feb. 2020

Jan. 2022

Nest Hotel Nara Nishi (MJ HOTEL Naha Nishi)Naha, Okinawa

143

Sep. 2020

Mar. 2022

Sotetsu FRESA INN Sendai (MJ HOTEL Sendai Chuo)
Hilton Okinawa Miyakojima Resort
Rosewood Miyakojima

Sendai, Miyagi

224

Oct. 2020

Jul. 2022

Miyakojima, Okinawa
Miyakojima, Okinawa

329
55

Feb. 2021
Mar. 2022

Jun. 2023
2024

64

Residential Business

MITSUBISHI ESTATE CO., LTD.

65

Residential Business1. Condominium Business Data #1
In FY2023, gross margin increased due to higher sales price and lower expenses, etc.
In FY2024, sales and profit expected to increase along with total units for sale.
FY2022(Results)
Condominiums
Sold(millions of yen)

FY2023(Results)

Land Bankby reporting period

FY2024(Forecasts)(As of End of March, 2023)

216,231

117,792

160,000

Condominiums
Sold(units)

3,046

1,596

2,200

Gross Margin *2 *3

22.5%

26.1%

24.0%

Inventory (units)

62

61

-

2,131

2,157

1,700

*1 *3

New Supply of
Condominiums(units)
*1
*2

6,150

Sales
= Sales of new condominiums + supplementary revenue relating to condominiums
Gross profit= Sales - COGS (land acquisition and development costs, building construction costs, etc.)
Gross profit margin = Gross profit ÷ Sales*3 From FY2022, the definition of sales has been changed (supplementary revenue relating to condominiums is
added), and the changed figures are shown, including the results of previous years.

MITSUBISHI ESTATE CO., LTD.

5,200

5,150

Total: 16,500 units
FY2024 - FY2026
FY2027 - FY2029
FY2030 -66

Residential Business

2. Condominium Business Data #2
Scheduled for delivery in FY2024
Name (Project Name)

The Parkhouse Gran Kamiyamacho

Location

Total Units

Scheduled
Delivery

800㎡

31

Apr. 2023

Site Area

The Parkhouse Okurayama

Yokohama, Kanagawa

The Parkhouse Kojimachi Residence

Chiyoda, Tokyo

1,100㎡

85

Jul. 2023

The Parkhouse Seiseki Sakuragaoka

Tama, Tokyo

600㎡

42

Jul. 2023

The Parkhouse Musashi Shinjo Front

Kawasaki, Kanagawa

1,400㎡

48

Jul. 2023

The Parkhouse Izumi 1-chome

Nagoya, Aichi

500㎡

40

Jul. 2023

The Parkhouse Kyoto Kawaramachi

Kyoto, Kyoto

700㎡

78

Nov. 2023

The Parkhouse Yoyogioyama

Shibuya, Tokyo

1,900㎡

63

Nov. 2023

The Parkhouse Kawagoe Tower

Kawagoe, Tokyo

2,600㎡

173

Dec. 2023

The Parkhouse Itabashi Oyama Okusunomori

Itabashi, Tokyo

5,300㎡

187

Dec. 2023

The Parkhouse Jiyugaoka Front

Setagaya, Tokyo

900㎡

32

Dec. 2023

The Parkhouse Hiroo

Shibuya, Tokyo

800㎡

22

Jan. 2024

The Parkhouse Yanaka Dokanyama Terrace

Taito, Tokyo

700㎡

58

Feb. 2024

The Parkhouse Gran Kamiyamacho

Shibuya, Tokyo

4,000㎡

55

Feb. 2024

The Parkhouse Omiya Kishikicho Suitei

Saitama, Saitama

1,900㎡

106

Feb. 2024

The Parkhouse Hikifune

Sumida, Tokyo

1,300㎡

99

Feb. 2024

The Parkhouse Minami-Azabu

Minato, Tokyo

400㎡

26

Mar. 2024

The Parkhouse Honatsugi

Atsugi, Kanagawa

1,800㎡

98

Mar. 2024

The Parkhouse Yokohama Kawawacho Terrace

Yokohama, Kanagawa

6,000㎡

164

Mar. 2024*Entire site

The Parkhouse Kawagoe Tower
MITSUBISHI ESTATE CO., LTD.

67

Residential Business3. Condominium Market Data
Number of New Supplies/Average Prices (the Greater Tokyo Area)(Unit)(Average price/Millions of yen)70

140,000

120,000

62.8

60

100,000

50

80,00040

60,00030
32,00040,00029,56910

20,0000202000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
(F)

Number of new supplies

0

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

MITSUBISHI ESTATE CO., LTD.

68

Residential Business

4. Rental apartments businessTotal Assets

Capital Gain on Sale

■Rental apartments
Approx. ¥155 bn(Billions of yen)

24.0

25.0

19.0

20.0

Assets under

15.0

development

10.0

39%
(50 buildings) Assets in Operation
61%(39 buildings)

10.0

7.0

5.0
0.0

FY2020

FY2021

5.0
FY2022

FY2023 FY2024(F)*Trends in capital gains for Residential Business■Other residential property（Assisted living residence, student
apartment, etc.)

Approx.

60 bn

Assets underdevelopment48%（20 buildings ）Assets in Operation

Property list (Rental apartments)
Name

Location

The Parkhabio Meguro Fort
The Parkhabio Kagurazaka Kazuki
The Parkhabio Nihonbashi Bakurocho
The Parkhabio Sangenjaya

Meguro, Tokyo
Shinjuku,Tokyo
Chuo, Tokyo
Setagaya, Tokyo

The Parkhabio Akabane
The Parkhabio Kamata
The Parkhabio Komagome
The Parkhabio Sumiyoshi
The Parkhabio Kagurazaka
The Parkhabio Himonya
The Parkhabio Nishiooi

Kita, Tokyo
Ota, Tokyo
Kita, Tokyo
Sumida, Tokyo
Shinjuku, Tokyo
Meguro, Tokyo
Shinagawa, Tokyo

The Parkhabio Minamiooi

Shinagawa, Tokyo

The Parkhabio Shinsen

Meguro, Tokyo

The Parkhabio Koenji Residence

Suginami, Tokyo

The Parkhabio Shin-Koenji

Suginami, Tokyo

The Parkhabio Azabujuban

Minato, Tokyo

The Parkhabio Koishikawa
The Parkhabio Meidaimae

Bunkyo, Tokyo
Setagaya, Tokyo

The Parkhabio Meguro Sakuratei
The Parkhabio SOHO Yoyogi Koen
The Parkhabio Gotanda
The Parkhabio Shibuya Cross
The Parkhabio Iriya
The Parkhabio Ebara Nakanobu Ekimae
The Parkhabio Takinogawa
The Parkhabio SOHO Yutenji
The Parkhabio Shimokitazawa
The Parkhabio Motoasakusa Place

Shinagawa, Tokyo
Shibuya, Tokyo
Shinagawa, Tokyo
Meguro, Tokyo
Taito, Tokyo
Shinagawa, Tokyo
Kita, Tokyo
Meguro, Tokyo
Setagaya, Tokyo
Taito, Tokyo

Total Units
27
77
110
63
39
60
42
63
54

44
85
109
102
140
58
106
51
42
106
81
61
160
90
112
138
53
52
47

Completion
Date
Jan. 2019
May 2019
May 2019
Jun. 2019
Sep. 2019Feb. 2020Feb. 2020
Mar. 2020
Mar. 2020
Mar. 2020
Apr. 2020
May 2021
May 2021
Aug. 2021
Oct. 2021
Oct. 2021
Dec. 2021
Jul. 2022
Sep. 2022
Oct. 2022
Nov. 2022
Jan. 2023
Feb. 2023
Feb. 2023
Feb. 2023
Mar. 2023
Mar. 2023
Mar. 2023

In addition to the listed above, there are approximately 10 projects in operation and 50
projects under development

52%(11 buildings)(End of March 2023)*Ratio by value

MITSUBISHI ESTATE CO., LTD.

The Parkhabio Minamiooi

69

International Business

MITSUBISHI ESTATE CO., LTD.

70

International Business１. International Business Strategy
Promote International Business at a total of five bases in the U.S., Europe, and Asia.
Business Profit Target for 2030 is Approx. ¥ 90.0 bn.
Business Area
Mitsubishi Estate London Limited

China
Total Asset Approx. ¥44bn

TaiwanTotal Asset Approx. ¥13bn

Rockefeller Group International, Inc.
Mitsubishi Estate New York Inc.

LondonNew Jersey

The United Kingdom
Total Asset Approx. ¥330bn

Colorado
Shanghai

Mitsubishi Estate (Shanghai) Ltd.

Hanoi
Bangkok
Mitsubishi Estate Asia Pte. Ltd.

New York

Georgia

Washington DC & Maryland

California
Arizona

Mitsubishi Estate Taiwan Ltd.

Miami

TaipeiHo Chi Minh CityThe United States
Total Asset Approx. ¥720bn

JakartaSoutheast Asia and Oceania
Total Asset Approx. ¥310bn

Towards 2030 Target♦

Annual investment: Approx. ¥200–250 bn♦

1st half of 2020s: Profit increase withasset accumulation♦

2nd half of 2020s:
Balance investment and return

Sydney2030 Target
Asia 45%

the U.S. 35%

Total Asset
Approx. ¥1.5tn

Europe 20%

MITSUBISHI ESTATE CO., LTD.

the U.S. 40%

Business Profit
Approx. ¥Asia 45%90.0bnEurope 15%71International Business

2. Regional Strategy/the U.S.
the U.S.

Asset Balance

Strategies• Strengthen capital recycling business and capitalize on RGII* know-how• Promote joint ventures with local partners*Rockefeller Group International, Inc.

Status of Overseas Assets (at end of FY2023)

Business Models
1

Office Leasing Business (Income gains)

Office leasing business in Manhattan, New York2

Development Business (Capital gains)

JV-type development business for offices, logistics, rental apartment, data centers, etc. in
the U.S.
*Organize SPCs for each PJ (in principle, we take major share and utilize project loans.).

3

Hybrid Model Investment BusinessHybrid Model Investment Business in Major U.S. Cities
The business model combines the strengths of the International Business and Investment
Management Businesses, aiming to expand and diversify the scale of investments, provide services
to third-party investors, and increase opportunities to earn various fees by introducing third-party
investors' funds in addition to the Company's own funds (see p80 for details).

Advantages• RGII's Development Expertise and Recognition– In its nearly 90-year history, RGII has extensive experience in the development of large-scale
mixed-use projects such as Rockefeller Center, as well as logistics facilities and residential
properties (condominiums and rental apartment).
• TA Realty's Sourcing Capabilities– Focusing on logistics facilities and rental apartment, we invest in and manage a wide range ofmarkets throughout the U.S. and contribute to the Group's sourcing efforts. In particular, TA
Realty ranks 8th in the U.S. in transaction value for logistics facilities.

Expected Return from Investment• IRR 8〜10%
MITSUBISHI ESTATE CO., LTD.

Ending Balance*︓¥1.1tn13%

the U.S. (Manhattan)
Europe2%

7%24%*inventories
24%+equity investment+fixed assets

5%

9%
39%

57%

FY2023¥433.0bn

Hybrid Model Investment
logistics・Data Center20%

Condominiums

the U.S. (Others)
Asia

Office・Mixed use
Rental Apartment
OthersBreakdown of Investment (CAPEX＋Equity Invst.)
1%
14%

logistics
Rental Apartment
Data Center

32%
17%

OfficeHybrid Model Investment/SameBoat Investment
Condominiums

FY2023¥77.1bn

18%

19%

Major Ongoing Project
Property Name

Location*1: Leasable area or units

Main Usage

Size*1

Completion

200 East 83rd

Manhattan, NY

Condominium

86 units

2023

600 Fifth Street NW

Washington D.C.

Office37,0002025

sol38（Liv Laveen）

Laveen, AZ

RentalApartment

360 units

2023

Patten Gray（1158 Delaware）

Denver, CO

RentalApartment

250 units2024

1072 West Peachtree

Atlanta, GA

Mixed use

50,7002026

55 Paradise

Bay Shore, NY

Logistics

16,7002023

Spotswood

Spotswood, NJ

Logistics

60,8002024

Data Center Bldg.1・2

Loudoun, VA

Data Center

51,0002024 (Bldg.1)
2025 (Bldg.2)

72International Business

3. Regional Strategy/Europe
EuropeStrategies• Investment and return that take into account the balance between stable earnings andhigher capital efficiency
Promote development business mainly concluded large-scale development projects•

Business Models
1

Office Development

Office development business in the central London

2

Asset Balance

13%

Ending balance*︓¥1.1 tn

12%
Rental apartments

24%*inventories+equity investment 24%+fixed assets
US (Manhattan)

39%

US (Others)

EuropeOffice,Mixed use
78%

Breakdown of Investment (CAPEX＋Equity Invst.)

Rental Apartment Development

29%
OfficeFY2023¥43.9 bn

Property development business on the European Continent.

Promote development business of income property on the European Continent.
Cooperate with Europa Capital and utilize rich network. Also make hybrid model
investments in funds managed by Europa Capital

FY2023¥262.0 bn

Asia

Rental Apartment Development Business in the Greater London Area and
Gateway Cities Outside of London

3

Hybrid model investment
10%

Status of Overseas Assets (at end of FY2023)

Rental appartment

71%

Major Ongoing Projects

Advantages

Property Name

Location

Main Usage

Size*1

Completion• Know-how and network based on nearly 40 years of successful business experience

8 Bishopsgate

London, UK

Office, Retail53,0002023

60-72 Upper Ground

London, UK

Office, Retailundecided Late 2020s

Barcelona, Spain

Office11,000Grace（Fyrkanten 11）

Stockholm,
SwedenOffice, retail,residents

7,800

The Lark（Nine Elms Park）

London, UK

Rentalapartments

195 units 2022

The Blossoms（Morello）

London, UK

RentalApartments

338 units 2023

– Our group-led development achievements and know-how in highly individualized and difficult
projects that require administrative consultations and applications for permits and approvals.
• Abundant network of Europa Capital– Established and managed 13 funds since 1995, with a total investment track record of over 13.4
billion Euros in 21 European countries. Established relationships with 120+ institutional investors
mainly in North America and Europe.

Expected Return from Investment• IRR 8〜10%
MITSUBISHI ESTATE CO., LTD.

dMoura1(Cristóbal de Moura 121-125)*afterrenovation

2023
1920

To be
renovated2023*1: Leasablearea or units

73International Business

4. Regional Strategy/Asia
Asset Balance

Asia

Others 7%

Status of Overseas Assets (at end of FY2023)

Strategies• Accumulate investment balance and establish a portfolio of Capital Recycling Business• Promote business with the two wheels of development business by Major Share andpartnership-based businessBusiness Models
1※ Mainly investment in local PJ companies and leveragedepending on the risk level of the project

Development of large-scale mixed-use facilities

Participation in joint ventures and large-scale mixed-use development projects with our
major share in SE Asia & Oceania

2Hybrid-model investment
12%

13%

Ending Balance*︓¥1.1 tn*inventories+equity investment 24%+fixed assets
US (Manhattan)

39%

US (Other)

Europe– Extensive business in Singapore, Vietnam, Thailand, China, etc. Most recently,
established a branch in Australia in May 2021 and is expanding business in the same
area.
Network of MEC Global Partners Asia
– Establish and manage funds that invest in a wide variety of real estate, including
office, retail, logistics, and residential properties.

Expected Return from Investment• Developed countries︓8〜10%／Developing countries︓more than 10%
Organization• Hands-on Development by expatriate and local staff for major share projects• Collaborate with local partners for minor share projects

MITSUBISHI ESTATE CO., LTD.

41%

Condominiums 40%

Breakdown of Investment(CAPEX＋Equity Invst.)
16%

1%
Mixed use

Development of Condominiums Business with local partners in Australia, Thailand, China,
and other areas

•

Asia

Development of condominiums

Advantages• Promote business in 10 countries and regions in Asia and Oceania

Offices, Mixed use

FY2023¥263.0 bn

24%

36%

FY2023¥66.9 bn47%

Condominiums
OfficeRetailMajor Ongoing Projects
Property Name

Location

Main Usage

Size

Completion

Suzhou ALPHA PARK

Jiangsu, Suzhou, China

Office220,400*1

2024

One City Centre

Bangkok, Thailand

Office, retail61,000*2

2023

Oasis Central Sudirman

Jakarta, Indonesia

Mixed use

307,000*1

2028

Parkline Place

Sydney, Australia

Office, retail49,100*2

2024

One Circular Quay

Sydney, Australia

Residents, Hotel,
RetailResidents 158
units
Hotel 220 rooms

2027*1: Total floor area

*2: Leasable area

Special Movie
Introducing development projects in Australia

Our main projects in Australia
https://youtu.be/FKGnA4QmDq0

Parkline Place74

https://youtu.be/2rg9MIcZUrM

74

International Business5. Condominium Business in Asia
In Asia, the land bank has been built up and deliveries are strong in the for-sale housing market.
■Major Ongoing ProjectLand Bank of For-Sale Condominiums in Asia
350
400

250 50

950
4,500
1,450
1,450

*Based on MEC's shares

Property Name(At the end of FY2023)
Location

Total units

MEC's shareCompletion

Southeast Asia
The Address Siam-Ratchathewi

Bangkok (Thailand)

880

49%

2023

Australia

Life Rama 4

Bangkok (Thailand)

1,237

49%

2024

Philippines

MalaysiaLife Phahon-Ladprao

Bangkok (Thailand)

598

49%

2024

Vietnam

OthersAspire Sukhumvit-Rama4

Bangkok (Thailand)

1,323

49%

2024

Aspire Onnut Station

Bangkok (Thailand)

696

49%

2025

GEMS

Selangor (Malaysia)

676

45％

2023

Oasi(previously L34)

Dong Nai Province (Vietnam)

489

49%

2024

DAISAN

Kota Tngerang (Indonasia)

1,780

49%

2027

Kizuna Heights

Manila (Philippines)

1,036

40%

2026

Zhongnan・Southern Shore Mansion

Huainan, Anhui

1,665

30%

2023

Taiwan・De you xiu chuan

Taoyuan, Taiwan

124

30%

2024

Weifeng・Elegant Residence

Changchun, Jilin

1,016

14%

2024

Weifeng・Sunrise Building

Changchu, Jilin

1,782

13%

2024

Vanke・Halo Space

Yantai, Shandong

1,441

40%

2024

Sydney (Australia)

R1 : 315
R2 : 322

R1 : 25%
R2 : 25%

2024

ThailandChina

Indonesia

Total: 9,400 units

East Asia

Oasia（previously L34）/Vietnam
Totals Units︓489
MEC's share︓49%
Life Rama 4／Thailand
Completion︓2024
Totals Units︓1,237
MEC's share︓49%
Completion︓2024

MITSUBISHI ESTATE CO., LTD.

Oceania
One Sydney Harbour R1/R2

All data as of end of FY2023

75

Investment Management Business

MITSUBISHI ESTATE CO., LTD.

76

Investment Management Business1. Investment Management Business︓Establishing Global Platform across 4
areas - Japan, US, Europe and Asia-PacificJapan Real Estate Asset Management Co., Ltd.

EuropeUnited States
TA Realty

Europe Capital

Asia-Pacific
MEC Global
Partners Asia

Carry out marketing & research and establish funds worldwide

Provide global opportunities to worldwide investors

Japan
Groupwide
Synergy

Japan Real Estate AssetManagement Co., Ltd.
Mitsubishi Jisho
Investment Advisors, Inc.

Mitsubishi Estate Group's network
for investment & development and management & services

MITSUBISHI ESTATE CO., LTD.

Established in 2000. Entrusted with asset managementof "Japan Real Estate Investment Corporation," the first
J-REIT listed in Japan in September 2001. Mainly invests
in office bldgs.

Mitsubishi Jisho Investment Advisors, Inc.
Established in 2001. Provides a wide range of real estate
investment products to institutional investors in Japanand overseas based on the know-how and resources
accumulated by the Mitsubishi Estate Group. Manages
listed REITs, private REITs, and private funds.

TA Realty (North America)
Established in 1982. A leading real estate investment
management company in the U.S. with funds that invest
in a diverse range of real estate, including logistics,
residential, office and retail properties in major cities
across the U.S. Acquired in 2015 and became asubsidiary.

Europa Capital (Europe)
Established in 1995. Based in the U.K., manages funds thatinvest in office, residential, commercial and logistics properties
throughout Europe. With track record of a total investment ofover €13.4 bn in 21 European countries. Acquired a stake in thecompany in 2010, making it a subsidiary.

MEC Global Partners Asia (Asia, Oceania)
Established in 2017 (name changed in 2021). Based in
Singapore, manages core open-end fund etc. that invest
in pan-Asia.

77

Investment Management Business2. Investment Management Business︓Growing AuM and Operating Profit
AuM has achieved the original target sooner(¥5.4 tn at end of FY2023).
Released new targets of AuM ¥10 tr and operating profit ¥30 bn by end of FY2031.
Changes in AuM and Operating Profit

At end of FY2023
Japan: At end of Mar. 2023
Overseas: At end of Dec. 2022
Asia and Oceania
200

Millionsof yenSince long-term plan 2030
released

50,000JRE
1,100Europe450

Overseas(Billions of yen)Appx.

¥5.4 tn

US
2,550

Japan
MJIA
1,100

Original target

Mid-2020s¥5 tn achieved(Released in Mar.
2023)

End of FY 2031
AuM︓¥10 tn
OP︓¥30 bn

9.0

AuM International
Operating Profit

8.0
7.0

35,00030,00030,00026,537

3.4

3.6
3.2

3.0

3.0

4.0

3.2
3.0

15,0001.9

9,231

10,000

5,000

6.0
5.0

3.8

3,046

4,282 5,082 4,520 4,596

2.0

4,467

8,054
5,966

1.0
0.0

0

14/3

MITSUBISHI ESTATE CO., LTD.

5.4

4.6

25,00020,000

New target

10.0

AuM Domestic
45,00040,000

Total

10.0

(Trillions of
yen）

15/3

16/3

17/3

18/3

19/3

20/3

21/3

22/3

23/3 End of FY 2031
(New Target)

78

Investment Management Business3. Investment Management Business︓Changes in Operating Profit
Continued to increase profit due to base fee etc. as a result of AuM expansion.
【Incentive fee】

(Billions of yen)

 For some funds, incentive fees are established in which the managementcompany receives a portion of the excess over expected returns.

30

26.5

 Such fees are received near the end of the fund as returns are determined,
but in accounting, the company updates returns as needed using market
valuations of real estate and records the fees it expects to earn as operating
revenue each period.

25

20

18.5
15

8.0

10

5

4.4

5.9
1.6

4.4

4.3

8.0

0

10.2

12.0

【ベースフィー等】【Base
fee etc.】
12.0

 Disposition fee: fee incurred in sales of investment property, linked withsale value

-5

AuM

(End
of FY)FY2021

FY2022

FY2023 FY2024(F)¥ 3.6 tn ¥ 3.7 tn ¥ 4.5 tn ¥ 5.4 tn

MITSUBISHI ESTATE CO., LTD.

 AM fee: fee received over management period, linked with AuM etc.
 Acquisition fee: fee incurred in acquisition of investment property, linked
with acquisition cost

-2.2
FY2020 Although it will contribute fully to operating revenue and operating profit,
its contribution to profit attributable to owners of parent will be limited
because a portion will be posted as profit attributable to noncontrollinginterests in the form of compensation to the officers and employees of theasset management company.

-

 Same boat investment dividend: dividend income in case of making acertain percentage of equity investment to share risk with investors*Besides same boat investment, Hybrid Model Investment is conducted.
Investment Management Business Group acts as the fund manager and solicits
funds from third-party investors, while International Business Group also
makes investments in a hybrid model investment. See next page for details.

79

Investment Management Businesswith International Business through
4. Investment Management Business: Synergies
Hybrid Model Investment
The business model, a fusion of strengths between IM Business G in fund management andInternational Business G in self-financing investment, expands mainly into the U.S. as well as Europe
and Asia.
Self-financing
Model

Hybrid Model

MEC only to invest

MEC + third-party investors to invest

MEC（International Business G）

MEC（International Business G）

Third-party investors
Fee income

Income/Capitalgains etc.

Investment

Limited scale ofinvestment and numberof properties

MITSUBISHI ESTATE CO., LTD.

Dividends andcapital gains etc.

Dividends andcapital gains etc.

Investment

Service

Investment

Enabling investment in more properties
 Risk dispersion and higher sourcing ability

MEC（Investment
Management G)

Management Service
 Gain fee income

80Investment Management Business5. Investment Management Business︓（Reference）Classification of Funds
Classification by Asset Liquidity
Open-end

A type of REIT or fund that allows investors to withdraw their investment in REIT units or funds upon request.
Examples︓ Private REITs

A type of REIT or fund that does not allows investors to withdraw their investment in REIT units or funds uponrequest.

Closed-end

Examples︓ Listed REITs… Secure liquidity by trading in the market

Private funds … Acquire and manage real estate with a set investment and management period of several years,
and eventually sell it to distribute returns to investors

Classification by Fund Strategy (Source: Website of the Association for Real Estate Securitization)Core

The fund aims to generate a target return mainly from rental income returns by income-producing property
investments.
*Capital return is not considered as a main target return, but the fund takes a low to medium market risk.

Core-plus

Value-added

Same as Core Fund, the fund aims to generate a target return mainly from rental income returns, but somefrom capital returns.
The fund aims to generate a target return mainly from rental income returns as well as capital returns byincreasing the yield and value of undervalued properties.
*Generally, the value-added strategy has a higher risk than the Core and Core-plus strategy because the fund often invests
in low yield properties with some physical obsolescence.

Opportunistic

The fund aims to generate a target return mainly from capital returns by trading properties based on themarket forecast.
*This is a higher risk strategy including adaptive reuse, bulk trade and M&As.

MITSUBISHI ESTATE CO., LTD.

81

Investment/Financial Data, etc.

MITSUBISHI ESTATE CO., LTD.

82

Investment/Financial Data, etc.

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

9

2,700
2,400

7.3

7.1
6.6

2,100

6.6
6.6

1,800

6.1

6.6

7
6.9

6.2

6.2

6
5

1,500
1,200

8

2,645.9

2,504.3
2,216.8

900
600
300

2,041.8

2,353.8

2,196.3

2,346.8

2,750.0
2,488.4

2,592.5

4
3

1.40

1.36

1.37

1.33

1.35

1.18

1.18

1.19

1.17

1.19

FY2020

FY2021

FY2022

FY2023

FY2024(F)

0

2
1
0

Net interest-bearing debt

Net interest-bearing debt
*after hybrid debt deductions

Debt/EBITDA ratio (right axis)

Debt/EBITDA ratio (right axis)*after hybrid debt deductions

Debt equality ratio

Debt equality ratio*after hybrid debt deduction

MITSUBISHI ESTATE CO., LTD.

83

Investment/Financial Data, etc.

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

4,000

96.1%

96.4%

95.1%

93.4%

93.6%

95.4%

93.2%

92.4%

93.3%

83.2%
3,000

73.2%

69.7%
64.1%

60.1%

6.8

54.0%

100.0

100.0

1.7
4.5

50

1.9
100.0

100.0

2.0

100.0

87.0%
1.4

75%

100.0

100.0
50

1,428.5

1,523.0

1,406.0

1,450.7

1,563.2

1,760.5

1,922.9

1,208.8

1,000

25%

701.5

685.2

250.0

250.0

250.0

250.0

250.0

215.0

215.0

215.0

653.0

612.7

603.8

558.9

577.1

595.7

661.3

632.2

0

Total

100%

50%
1,381.2

1,261.9

5.6

86.5%

76.4%

7.228

9.5

2,000

4.7

76.2%

93.2%

0%
14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

22/3

23/3

1,973.0

1,929.3

2,291.0

2,396.9

2,481.6

2,319.5

2,429.8

2,526.1

2,738.6

2,871.6

Straight bond

MITSUBISHI ESTATE CO., LTD.

Subordinated bondBank Loan

Subordinated loan

CP

Lease liability

Fixed ratio

Long-term ratio84

Investment/Financial Data, etc.

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

2.0%

12

1.72%
1.54%

1.55%

1.52%

8

1.41%
1.27%
5.55

4

8.16

6.79

6.18
5.58

5.45

1.05%

1.07%

6.36

5.71

0.96%

1.38%

1.32%

6.69

0.95%

0.97%

0.87%
0.75%

0.70%
0.62%

0.61%

0.66%

1.5%

1.24%
1.09%
0.96%

0.92%
0.84%

0.72%

7.83

7.23

1.14%
0.96%

8.20

0.71%

0.68%

0.78%
0.63%

0.74%

0.91%

1.0%

0.80%
0.74%

0.60%
0.5%

0
12/3

13/3

14/3

15/3

Average duration of interest-bearing debt

MITSUBISHI ESTATE CO., LTD.

16/3

17/3

18/3

Bonds/Average interest

19/3

20/3

21/3

Bank loans/Average interest

22/3

23/3

Total/Average interest

85

Investment/Financial Data, etc.

4. Interest-Bearing Debt: Procurement Status (Consolidated)
Total Interest-Bearing Debt

Loan Breakdown(At the end of Mar. 2023)

Subsidiaries Breakdown(At the end of Mar. 2023)(At the end of Mar. 2023)(Billions of yen)

Others 85.4

Lease liability
1.4

Bond
847.2

2,022.9
2,871.6

MEC*
1,654.9

Subsidiaries
368.0

Asia
11.0

368.0

US
148.2

Europe123.3

Loan2,022.9*For overseas,loans from the following companies respectively
US: MEC Group International
Europe: MEC Europe
Asia: MEC Asia etc.

*Including foreign currency loans by MEC

Procurement Interest Rates
1.79%

2%

MEC
1.44%
0.94%

0.97%

1%
0.96%
0.96%

0.97%

16/3
MITSUBISHI ESTATE CO., LTD.

0.93%

0.92%

0.84%

0.95%

1.38%

Consolidated
1.34%

0.87%

0.86%
0.79%

0.78%

0.74%

0.89%
0.80%

0.67%

0.20%

0%

0.95%

0.98%

Subsidiaries

17/3

18/3

19/3

20/3

21/3

22/3

23/3

86

Overview of the "Long-Term Management
Plan 2030"

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/en/ir/plan2030/
MITSUBISHI ESTATE CO., LTD.

87

Overview of the "Long-Term Management Plan 2030"

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

Mitsubishi Estate Groupʼs 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
Create value for every
stakeholder including visitorsand employees

2030 Target

A pair of driving wheels

Increasing
SocialValue

Increasing
Shareholder
Value

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.

88

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＋
Moodyʻs︓A2* Will adjust to business conditions*2 Business Profit= Operating Income + Equity in earnings (loss) unconsolidated subsidiaries and affiliates

MITSUBISHI ESTATE CO., LTD.

89

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)【 Flexible capital policy 】

Total Assets

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

Business Profits

Total Assets¥5.9 tn

conditions

Approx. ¥7-8 tn
Expected net increase: ¥1-2 tn＝

Increase Net investment: Approx. ¥2–3 tn

ROA: 3.9%

ROA: 5%
With current leverage

ROE: 7.8％
MITSUBISHI ESTATE CO., LTD.

Decrease Depreciation: Approx. ¥1 tn

ROE: 10％90

Overview of the "Long-Term Management Plan 2030"

4. 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

91

Overview of the "Long-Term Management Plan 2030"

5. Profit Growth Strategy - 2030 Vision

Growth Strategy

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*Repost from the "Long-Term Management Plan 2030"① 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* Composition of FY20 Business Profits = ① Domestic Asset + ② International Asset + ③ Non-asset Business + Eliminations or corporate(round number)

MITSUBISHI ESTATE CO., LTD.

(¥ 201.0 bn)(¥ 36 bn)(¥ 16 bn)(- ¥ 23 bn)

92

Overview of the "Long-Term Management Plan 2030"

6. Roadmap for Profit Growth
Early stage

Domestic
Asset
Business*Repost from the "Long-Term Management Plan 2030"

Middle stage

Advanceredevelopment projects• Complete Tokiwabashi A Bldg.
• Open & expand outlet mall
• Asset sales and reconstruction of existing buildings (willlower rental profits)• Temporary decline in the condominium units soldProfits scale with asset accumulation

International
Asset
Business• 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

Non-asset
Business

MITSUBISHI ESTATE CO., LTD.

• Stable growth in existing businesses• Promoting commercialization in new domains

Late stage

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

Stabilize profits via capital recycling• 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

93Appendix.

MITSUBISHI ESTATE CO., LTD.

94

Macro Index

1．Historical Consumer Price Index（YoY, ％）

Consumer Price Index in different countries (composite) *

12%

10.1%

10%

8%

6.4%

6%

4%

4.3%

2%

2.1%

0%

-2%

19/7

19/10

20/1

20/4

20/7

20/10

United States

MITSUBISHI ESTATE CO., LTD.

21/1
China

21/4

21/7

21/10

United Kingdom

22/1

22/4

22/7

22/10

23/1

Japan

*All indices are a composite index
Source: US Department of Labor, Statistical Office of the European Union, National
Bureau of Statistics of China, Ministry of Internal Affairs and Communications95

Macro Index

2．Historical Interest Rates
Domestic and international Interest Rate (monthly)

(%）

5.0%

Domestic Interest Rate
(Monthly)
0.6%

4.0%

0.4%
3.0%

JGB yield of newly issued 10-year government
bonds
Unsecured overnight call rate

0.2%
0.0%

2.0%

-0.2%

1.0%

0.0%

-1.0%

JGB yield of newly issued 10-year government bonds

Unsecured overnight call rate

The effective federal funds rate(US)Current Bank Rate(England)
Source: Bank of Japan、Federal Reserve Bank of New York、Bank of England

MITSUBISHI ESTATE CO., LTD.

96

Macro Index

3．Historical foreign exchange rate
(Yen/Dollar)

Dollar-yen exchange rate

150
140
130
120
110
100
90
80
70

Source: Bank of Japan "Financial and Economic Statistics Monthly"
MITSUBISHI ESTATE CO., LTD.

97

Contact Information
Investor Relations Office,Corporate Communications Department
Mitsubishi Estate Co., LTD.
+81-3-3287-5200
https://www.mec.co.jp/en/<Disclaimer>This material is provided for information purposes only. Nothing herein is intended to constitute an offer to sell, a solicitation of an
offer to buy, or a recommendation of any specific products by Mitsubishi Estate Co., Ltd. (the “Company”)
The contents of this material involve judgements based on the information available to the Company as of the releasing date.
Although the information expressed is obtained or compiled from sources that the Company believes to be reliable, the Company
cannot and does not guarantee the accuracy, certainty or completeness of the information.
Forward-looking statements contained herein involve known and unknown risks, uncertainties and other factors that may affectfuture results or events expressed in those statements, and therefore should not be read as a guarantee by the Company that such
results or events will be achieved as stated.
Further, the Company undertakes no obligation to update any of such forward-looking statements, whether as a result of new
information, future events or otherwise. This material may also be changed or removed without prior notice.
The contents of this material may not be copied, reproduced, or distributed in any way without prior consent from the Company.

MITSUBISHI ESTATE CO., LTD.