FY2023 – 2Q

(The Fiscal Year Ending on March 31, 2023)

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/e/investor/plan/pdf/plan200124_e.pdf

Contents
Financial Overview

3

Summary of FY2023-2Q Results

4

Summary of FY2023 Forecasts

10

Progress of Long-Term Management Plan

17

ESG Initiatives (Sustainability Initiatives)

27

Financial Supplemental Data

36

Business Overview

44

Commercial Property Business
Office Building

47

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

62

Residential Business

69

International Business75

Investment Management Business81

Investment/Financial Data, etc.

86

Overview of the "Long-Term Management Plan 2030"

90

Appendix.

97

MITSUBISHI ESTATE CO., LTD.

2

Financial Overview

Financial Overview＜FY 2023-2Q Financial Results＞
 Overall YoY growth in operating revenue, operating profit, and profit attributable toowners of parents (historical high)【Main factors】••••

Increase in capital gains from overseas business
Reduced impact from COVID-19 in both Retail Properties, and Hotels BusinessContributed to profit from full-year operation of Tokiwabashi Tower
Incentive fees in the investment management business Announced "Kokusai and Teigeki Buildings Redevelopment", capturing domestic andinternational investment opportunities in the capital recycling investment business (seeP19,20,22,23)
 Decided ¥100 bn share buyback as a part of capital policy, following FY2020 and FY2022＜FY2023Forecasts＞
 Unchanged from the forecast announced on May 12, 2022
MITSUBISHI ESTATE CO., LTD.

3

Summary of FY2023-2Q Results

MITSUBISHI ESTATE CO., LTD.

4

Summary of FY2023-2Q Results

1. Income Statement Results for FY2023-2Q
Significant increase in revenue and profit (record high) YoY due to increase in capital gains from
Millions of yen (rounded off
International Business as in 1Q. Millions of yen (rounded down) Capital Gains included in Operating Profit
to the nearest billion)<New Segment>
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

579,023
371,445
135,293
44,03812,544
28,684(12,983)
111,658
97,0705,665
18,5484,097(2,436)(11,285)
7,784

Change15,541(38,336)(14,659)
49,995
16,9352,200(595)
30,420(19,151)(2,325)42,237
10,511
1,005(1,857)
(21)

289

277

11

19,307130,534
6,269
13,617
31,52815,314
76,342

24,811
94,631
8,087
11,56928,538
7,323
55,287(5,503)35,902(1,817)
2,048
2,990
7,990
21,055

FY2023-2Q

594,565
333,109
120,633
94,03329,48030,885(13,578)
142,078
77,9193,339
60,786
14,608(1,430)(13,143)
7,762

FY2022-2Q

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

142,368
194,350
2,986,764

111,936
162,220
2,753,754

30,432
32,130233,010

FY2022-2Q

58,0006,000
5,000
47,000-36,00024,000
5,000
7,000
-

Change22,000(18,000)
0
40,000-Major Factors for Changes in
Operating Profit by BusinessMillions of yen (rounded down)

Others9,659
Commercial
Property Residential International
42,237(19,151)(2,325)
Increase in capital gains

111,658

142,078

Decrease in capital gains
Reduced impact from COVID-19 byimproving the business environment
Investment Management Business:
Recognition of incentive fees

Millions of yen (rounded down)
FY2023-2Q FY2022-2Q
ChangeBusiness profits
EBITDA
Interest-bearing debt

FY2023-2Q

FY2022-2Q

Commercial
Property

Residential International

Others

FY2023-2Q*Architectural Design & Engineering / Real Estate Service Business and Other businesses
MITSUBISHI ESTATE CO., LTD.

5

Summary of FY2023-2Q Results

2. Changes in Revenue from Operations by Asset Type (Japan)
Hotels business continued steady recovery.
Outlet Malls and Retail Properties business also posted YoY revenue growth.
Office buildings*1

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

Closure of retail properties
and hotels under SOEs

80
69.2
70

60.7 60.1 60.4 62.2 61.1

62.5 62.5 61.9 62.1

64.2

62.9 62.8

12.0

11.6

11.3

60

12.0

10.0

10.8 10.9

11.3

11.5

10.9

30.9

33.5 33.6
31.6 32.7

37.0 37.4 37.3 37.5 37.4 36.3
35.1 36.1 35.5

7.2

8.0

9.4 9.1

8.9

50

10.6

7.2

8.7
8.7

6.4 6.2
4.2

9.1 8.9

15.6 16.0 16.1 16.8 14.3 15.1 15.3 14.6 14.8 15.1 15.0 15.3 15.1 15.8

4.0
2.3
2.0

10

8.4

※4

6.2

9.4

6.6

4.8

4.2

5.7

11.2 11.4

9.3
10.3

6.0

30
20

11.4

preemergency
measures

12.5

11.9

10.1

40

No
4th

14.0

*2

61.2

No Yes*3
2nd 3rd

Yes
1st

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
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
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
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
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 FY2023-2Q Results

3. 2Q Results Summary and Highlights
YoY increase in capital gains from International Business, etc. In line with full year forecasts.
YoY Change in Business Profits(Billions of yen)(Billions of yen)

142.3

111.9

Progress to the Full-year Forecasts
291.4

Capital gains︓＋22.0【Breakdown】• Commercial︓▲18.0• Residential︓±0• International ︓+40.0

Breakdown
122.0
Domestic
Condominiums,
etc.*1【Major factors】• Gains from Tokiwabashi Tower• Improved business environmentfor Retail Properties and Hotels• Investment Management Business:
Recognition of incentive fees

2.7
FY2022 2Q
Results

85.1

-0.8

FY2023 2Q
Results

Domestic
Condominiums,
etc.※1 :▲3.5【Major factors】• Decline in units delivered• Concentration of deliveries in the
2H

48％

Capital gains

Income gains︓+12.8

72.3

49％

Total

58.0

36.0

FY2023 Forecasts (2Q Progress)

0％

5.0

Income gains
52％
164.4

Capital gains︓
48％ progress【Breakdown】• Commercial︓17％• Residential︓23％• International︓72％

Domestic
Condominiums,
etc.※1︓0％ progress【Major improvements in the
2H】• Concentration of deliveries
in the 2H(92.4% of planneddelivery amount has
already been confirmed)

Income gains︓
52％ progress【Major factors】• Gains from Tokiwabashi
Tower• Improved businessenvironment for Retail
Properties and Hotels• Investment Management
Business: Recognition of
incentive fees

※1 Excluding capital gains, etc. from the Mitsubishi Estate Residence's operating income

MITSUBISHI ESTATE CO., LTD.

7

Summary of FY2023-2Q Results

4. Capital Policy︓Share Buyback
Decided ¥100 bn share buyback as a part of capital policy to enhance shareholder returns
 Decided ¥100 bn buy back yen to enhance shareholder value, as stated in the Long-Term Management Plan, even in a drasticallychanging business environment.（ 1 ） Evaluated steady profit growth, carefully selected investments that will lead to future profit growth, prospects for return, stock
price level, and other factors.
 Consistently enhancing shareholder returns since FY2020, and as a result, bought back ¥230 bn shares in 4 years.（ 2 ） The share buyback of approx. ¥130 bn conducted in FY2020 and FY2022 will be cancelled at the end of November 2022.

Changes in Shareholder Returns(Billions of yen)160

1¥100 bn

to be determined thisfiscal year
150.0

144.6

2

120

Additional shareholders returnby ¥230 bn in 4 years

100

77.7

80

100

30
40
0

27.7

36

41.6

44.6

41.4

47.7

50

FY17

FY18

FY19

FY20

FY21

FY22

FY23 (E)

Total dividends paid
MITSUBISHI ESTATE CO., LTD.

Share buybacks
8Summary of FY2023-2Q Results

5. Impact on businesses due to external environmental changes
Optimize business impact of drastic changes in external environment throughportfolio diversification and skilled management.
Risk factors

Business impact•＋

Recent policies to ease restrictions on entry into Japan and the "National Travel Support
Program" may lead to a further recovery in demand for inbound travel (hotels, outlet malls,
and retail properties) and domestic travel.

•­

Re-spreading of the infection or more severe cases, requiring restrictions on activities, could
have an impact on retail properties and hotels businesses.

＋

If yen depreciates more, positive impact on the yen-based consolidated PL is expected.

COVID-19

Exchange rate fluctuations(rapid depreciation of yen)

Inflation

Rising interest rates

MITSUBISHI ESTATE CO., LTD.

※ Forecasted AR/CR in the initial assumption: ￥120/＄, ￥160/￡­

Price hikes of imported products may affect business profitability.

•＋

Inflows of funds into the real estate market may increase as an asset that can withstandinflation.

＋•

Inflation may lead to higher rents and improved asset value in the future.

•­

Increased construction costs due to higher material and labor costs as well as increased
energy costs may affect the business feasibility.

•­

Interest payments may increase as interest rates hike to curb inflation, mainly overseas.

•­Interest rate hikes, especially overseas, could have an impact on CAP rates for assets withpoor market competitiveness.

9Summary of FY2023 Forecasts※Unchanged from the forecast announced on May 12, 2022

MITSUBISHI ESTATE CO., LTD.

10

Summary of FY2023 Forecasts
from the forecast
1. FY2023 Income Statement Forecasts（vs FY2022 Results） ※Unchanged
announced on May 12, 2022

Record-high profits expected from significant increases in capital gains in the International Business.
<New Segment>
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※
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
Profitable attributable to non-controllinginterests
Profit attributable to owners of parent

2023/3
Forecast

Millions of yen (rounded down)

2022/3Results

Change1,416,000
788,000
345,000
205,000
35,00073,000(30,000)
291,000
182,000
27,00094,00013,0002,000(27,000)
12,0001,349,489
760,658
380,959
121,234
46,702
67,914(27,979)
278,977
189,90930,17355,816
26,537
1,119(24,578)
16,31966,511
27,342(35,959)
83,766(11,702)
5,086(2,021)
12,023(7,909)(3,173)38,184(13,537)881(2,422)(4,319)

400

332

68

32,000271,000
6,000
22,00076,00041,586
253,710
20,18920,12070,889(9,586)
17,290(14,189)
1,880
5,111

14,00027,718(13,718)

165,000

2023/3
Forecast

2022/3Results

Millions of yen (rounded off to thenearest billion)

2023/3
Forecast

2022/3Results

Change122,000

76,00046,000Commercial Property Business

35,00042,000(7,000)Residential Business

22,0005,000

17,000International Business

Total

65,00029,00036,000Investment Management Business

-

-

-

Other

-

-

-

Eliminations or corporate

-

-

-

Major Factors for Changes in
Operating Profit by Business

Commercial
Property(7,909)278,977

155,171
9,829
Millions of yen (rounded down)International
38,184
Residential(3,173)

Others(15,078)

IM Business
Rebound of incentive fee
291,000

Increase in capital gains
Decrease in profit fromcondominiums
Decrease in capital gains
Decrease in profits frombuildings closure

Change291,400
279,310
12,090Business profits
395,000
381,434
13,566
EBITDA
2,820,000
2,738,632
81,368Interest-bearing debt
※ Architectural Design & Engineering / Real Estate Service Business and Other businesses
MITSUBISHI ESTATE CO., LTD.

Capital Gains included in Operating Profit

FY2022
Results

Commercial
Property

Residential International

Others

FY2023
Forecasts

11

Summary of FY2023 Forecasts

2. FY2023 Business Profits Breakdown (vs FY2022)※Unchanged from the forecast
announced on May 12, 2022

Record-high profits expected, mainly from significant increase in capital gains andbusiness recovery from COVID-19.
FY2023 Forecasts
Business profits 291.4(Billions of yen)

FY2022 Results
Business profits 279.3
Excl.
Residential

Capitalgains

Capital
gains

71.0

76.0

Excl. Residential

100.0

122.0
5.0

Residential capital gains

Residential

30.2

25.3

IM business

Domestic
condominiums, etc.

5.0

26.5

Income gains

178.0

Excl. IMBusiness

151.6

22.0

164.4

Residential

IM business

13.0

Incomegains

76.0 → 122.0（+46.0）【Breakdown】
・Commercial ︓-7.0
・Residential
︓+17.0・International ︓＋36.0

Domestic Condominiums, etc.
Breakdown of change

Residential capital gains

Domestic
condominiums, etc.*

Capital gains Breakdown of change

Excl. IMBusiness

151.4

27.0

25.3 → 5.0（-20.3）【Main Factor】- Substantial decrease in sales volume

Income Gains Breakdown of change

178.0 → 164.4（-13.6）【Main Factor】＋Gains from new buildings＋Improved business environment for commercial
and hotel business- Rebound of investment management incentive
fees- Decrease in profits from the buildings ofredevelopment projects- Decrease in rental profits due to property sales* Excluding capital gains, etc. from the Mitsubishi Estate Residence's operating income

MITSUBISHI ESTATE CO., LTD.

12

Summary of FY2023 Forecasts

3. Capital Policy #2: FY2023 Cashflow Forecast※Unchanged from the forecast announced
on May 12, 2022

Increased cash inflows from profit growth and increased collections.
Aiming for accumulating solid planned investments and new investment opportunities.
Cash in870〜920

Healthy financial level allows newinvestments

Cash out
870〜920
Financing arrangements（Increase in liabilities)
150〜200

Strategic
allocation
100〜150(Billions of yen)

Continue planning to pursue strategic
investment opportunities, esp. in
capital recycling in Japan and overseas
Large-scale residential land acquisition anddelivery timing delays（Completed in 2022/4）

Steady Investment opportunities
acquisition, mainly in Japan
Increased collection from capital gains（+50 YoY）

Returns*1
450

PlannedInvestments*2
720【 Major investments in FY2022 】
Marunouchi
Outlet Mall, etc.
Domestic condominium
Domestic capital recycling andothersOverseas

Increased operating CF due to growthin business profit (+40 YoY)

Cash flows fromoperatingactivities*3
270

Dividends
50

60
30
230
250
150

Payout ratio: Approx. 30%
DPS: ¥38（up ¥2 YoY）
(Expected to reach record high).

*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 *4 Sale of low-performing assets to improve capital efficiency

MITSUBISHI ESTATE CO., LTD.

13

Summary of FY2023 Forecasts※Ref. Supplementary information on investment assumption
Consistency between cash flow prediction on the previous page and FACTBOOK investment data(p7) is as follows. Of the strategic allocation, 109 billion yen will be used for new investments
under the initial assumption.
Investment
assumption in
FACTBOOK

Cash flow
prediction in IR
materials(Billions of yen)

Strategic
Allocation
100〜150

109(New Investment) 14(New Investment) 25(New Investment) 14(New Investment) 70(New Investment) 25【Major investments】
Marunouchi
Outlet Malls, etc
Domestic
Condominiums
Domestic Capital
Recycling
Overseas

60
30
230
250
150

Base
Investment(New Investment) 70

Total
829
Domestic
Condominiums,
etc.
230(“Inventories”)

EquityInvestment
140

※

720
Of the strategic allocation, 109
billion yen will be used for new
investments

CAPEX
459

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

MITSUBISHI ESTATE CO., LTD.

14

Summary of FY2023 Forecasts

4. Shareholders Returns※Unchanged from the forecast
announced on May 12, 2022

The dividend forecast is ¥38 (up ¥2 YoY). Expect record-high DPS for the second consecutive year.
(Yen)

40
36
35

33
30

30

30.4%

26
25
20

12

10
5
0

14

31
30.6%

30.9%

30.5%

30%

30.0%

29%

16
28%
26.6%

27%

25.9%

26%

FY2015FY2016FY2017FY2018Amount of
Share
Buyback

FY2019FY2020¥ 100 billion
Dividends per share

MITSUBISHI ESTATE CO., LTD.

31%

27.0%
26.5%

FY2014

33%
32%

30.9%

20
15

38

FY2021

FY2022

FY2023(Revised
forecast)

25%¥ 30 billion

Payout ratio (right axis)
15

Summary of FY2023 Forecasts

5. Changes in ROA/ROE/EPS※Unchanged from the forecast announced on May 12, 2022

For FY2023, EPS is expected to reach record high with ROE maintaining the 8% level.
ROA、ROE（%）

EPS（yen）

12%

240
200

10%

10%
8.5%

8.1%

7.8%

8%

7.6%

7.3%

5.2%

124.75

5.6%

108.64
96.97
86.78

4%

52.85
3.3%

60.13
3.3%

4.0%

116.45
5%

101.34

4.1%

4.4%

120

4.4%

3.8%

74.00
3.6%

8.0%
160

6.6%
6%

200

80

3.8%

2%

40

0%

0
FY2015FY2016FY2017FY2018FY2019FY2020EPS(right axis)

MITSUBISHI ESTATE CO., LTD.

FY2021*ROA

FY2022ROE

FY2023(Forecast)

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

16

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/e/investor/plan/pdf/plan200124_e.pdf
MITSUBISHI ESTATE CO., LTD.

17

Progress of the Long-Term Management Plan

1. Domestic Asset Business #1 : Profit Trends*Repost from FY2023 IR Presentation announced on May 12, 2022

Capital gain returns exceeded expectations in each asset, while income gain growth
was affected by COVID-19.
（vs FY2020 Forecast (¥201 billion))

250.0

215.8
201.5

201.6

33.0

39.0

200.0

150.0

Capital gains

Business profit (LT plan) +50.0bn(Billions of yen)

14.7

16.7

+50 bn

203.4

47.0
57.0
25.3

5.0

 Continuous capital gains mainly from offices, logistics facilities, andrental apartment.

FY2021￥39 billion

Office︓¥ 24.0 bn
Logistics︓ ¥ 8.0 bn
Residential︓¥ 7.0 bn

Main Properties for Sale

■Link Square Shinjuku（partial ownership）■Toyosu Front（partial ownership）

Use : OfficeTotal floor area︓Approx. 44,000㎡
Use : Logistics facilities
Total floor area︓
Approx. 297,000㎡

153.8

145.9

143.4

141.4

¥47 billion

Office︓¥ 35.0 bn
Logistics︓ ¥ 7.0 bn
Residential︓ ¥ 5.0 bn

Main Properties for Sale■LOGIPORT KAWASAKI BAY

100.0

FY2022【Residential Business】
Sold 6 properties

Use︓OfficeTotal floor area︓
Approx. 107,000㎡【Residential Business】
Sold 4 properties

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

50.0

Income gains

0.0
FY2020
Income gains

MITSUBISHI ESTATE CO., LTD.

FY2021

FY2022

Domestic Condminium for sale

FY2023(F) Goals of2030
Capital gains

 New building operations contributed to profit, whereas profit loss derived fromredevelopment of buildings, etc.
 Outlets and commercial facilities significantly affected by COVID-19 from FY2021,
but gradually recovering

18

Progress of the Long-Term Management Plan

2. Domestic Asset Business #2*Updated from FY2023 1Q IR Presentation

Progress in capital recycling business investment further expands pipeline.
Property Name ･(including tentative name)*1

Marunouchi

D
o
m
e
s
t
i
c

Mixed Use・
OfficeOutlet Mall

Large-scale
Logistics(100,000㎡+)･Area※2

Tokiwabashi Tower (Building A）

146,000㎡

Uchikanda 1-chome Project

85,200㎡

Yurakucho Building ・Shin-Yurakucho Building Redevelopment Project※3

FY2022

FY2023

FY2024FY2025544,000㎡

Kokusai Building ・Teigeki Building Redevelopment Project

※3

★
★
★

67,000㎡★

Toyosu 4-2 Development Project

136,500㎡

Tenjin 1-7 Redevelopment Project (Fukuoka)

74,000㎡

Umekita Second Zone Development Project (Rental Property)(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 Kumoidori 5-chome Redevelopment Project(Kobe)

98,570㎡●★

●
Gradual completion and opening

★

●
★

●

★

●
●

★

6,600㎡

Akasaka 2・6-chome Development Project

210,000㎡★

34,500㎡

Tokyo Ryutsu Center Distribution A Building

205,000㎡

Sagamihara-shi Chuo-ku Fuchinobe Project
Misato-shi Hikoito Project…Project announces after the Long-term Management Plan★

●

170,900㎡★

Approx.¥1.25 tn. at the end FY2022●●

54,000㎡

Under consideration

277,000㎡★

●・・・Completion… Project added this quarter※１ Includes properties expected to be sold by 2030

※2 Total floor area unless otherwise noted.

■Book value of domestic assets* in capital
recycling business

Under consideration★

★・・・Start Construction

●

●

★

178,700㎡※3

Approx.
\1.2-1.3
tn●★

Under consideration※4

Approx.
\75-80bn●※3245,000㎡

Estimated･Inv
estment●

Former Hotel Grand Palace site Redevelopment Project※3

Estimated
operation)

NOI･(Stable

Under consideration

14,700㎡

KYOTO JOYO PREMIUM OUTLETS®

2030

●

9,400㎡

Osaka Mitsubishi Building Reconstruction Project

Logicross Zama〜

Under consideration

3rd MINAMI AOYAMAFUKAYA HANAZONO PREMIUM OUTLETS®

FY2026●

10,700㎡

Torch Tower（Building B）

Kyoto Joyo Next-Generation Core Logistics Facilities ProjectRed

Total Floor※3 Site area●

Office3.3% 7.6%
2.7%
11.3%
11.1%

64.1%

RetailProperties
RentalApartments
Logistics
Facilities
HotelsOther※Domestic Income Generating Assets excluding Marunouchi

Outlet mall and assets of certain consolidated subsidiaries.

MITSUBISHI ESTATE CO., LTD.

19

Progress of the Long-Term Management Plan

3. Domestic Asset Business #3
Advance redevelopment projects in Marunouchi■Joint Redevelopment Project - Kokusai Building and Teigeki Building
Overview of the Kokusai Building
Location
Structure andscale
Site area
Floor area
Completion
Owners︓1-1, Marunouchi 3-chome, Chiyoda-ku, Tokyo
︓Steel-framed reinforced concrete structure (6 floors
below ground, 9 floors above ground, 3 roof structures)︓5,623.30 m2
︓76,918.25m2
︓Sep. 1966
︓Mitsubishi Estate Co., Ltd., General Incorporated
Association Nihon Club

Overview of the Teigeki Building
Location
Structureand scale
Site area
Floor area
Completion
Owners︓1-1, Marunouchi 3-chome, Chiyoda-ku, Tokyo
︓Steel-framed reinforced concrete structure (6 floors below
ground, 9 floors above ground, 3 roof structures)︓3,825.05m2
︓39,419.80m2
︓Sep. 1966
︓Toho Co., Ltd., Idemitsu Museum of Arts

Capture business opportunities in areas of Japan■Nishiki 3-25 Development Project
Project Features• Nagoya's new landmark tower• Enhance international competitiveness and create
vibrant community in hotels, office buildings, andmultiplex cinemas• Conrad Hotels and Resorts scheduled to open

Project Overview
Location
Site area
Floor area
Number offloorsSchedule

︓Nishiki 3-chome, Naka-ku, Nagoya City︓4,866.4０m2
︓Approx. 109,700m2
︓41 floors above ground (211m), 4 floors below ground,1 roof structure︓Construction began in Jul. 2022,
to be completed in Mar. 2026

▲Image of the building■ Dogenzaka 2-chome South District Redevelopment Project
Project Features• Large-scale multi-use development directly connected
to Shibuya Station on the Inokashira Line

Project Features• Enhance livelihood through the development of plazas• The second redevelopment project in the Yurakucho area,• TRUNK（HOTEL) scheduled to open

following the Yurakucho Building and Shin-Yurakucho Building• Further develop the buildings as a base for culture and the arts in

the Yurakucho area, and contribute to improvement of theinternational competitiveness of Tokyo by developing an attractive
town• Scheduled to close by 2025

MITSUBISHI ESTATE CO., LTD.

Office 3-30F

and retail properties along the Dogenzaka street

Project Overview
Location︓Dogenzaka 2-chome, Shibura-ku
Site area ︓6,720m2
Floor area ︓Approx. 87,100m2
Number of ︓Office building/ 30 floors above ground, 3 floors below
floorsground, 2 roof structures
Hotel building/ 11 floors above ground, 2 floors below
ground, 1 roof structure
Schedule ︓Construction scheduled to begin in FY 2023, to becompleted in FY 2026

Hotel
1-11F
Stores etc. 1-3F

▲Cross-sectional view

20

Progress of the Long-Term Management Plan
*Repost from FY2023 IR Presentation
announced on May 12, 2022

4. International Asset Business #1 : Profit Trends

Steady profit growth in both income and capital gains. +¥58.0 bn growth expected in FY2023
compared to FY2020 forecast (¥36.0 bn), driven by large capital gains.
Business profit(long-term target) +¥50.0 bn(vs. initial forecast
for FY2020 (¥36.0 bn))

(Billions of yen)

94.0
80.0

Capital Gains Basis on U.S. capital recycling business (¥10-20
bn/year) Continued contribution from capital recycling inEurope and portfolio expansion in Asia to achieve
capital gains growth.
■ Breakdown of Capital Gains by region

55.8

60.0

65.0

+¥ 50 bn

46.1
37.9

40.0

28.0

29.0

3

60

38

40

28

20

16

12

11

12

12

18

24

FY2020

FY2021

FY2022

FY2023(F)

0

12.0

65

29

US

Europe

Asia

20.0

18.1

25.9

26.8

Income Gains

29.0

 Achieved ¥10.0 billion growth in FY2020 through area
strategies

0.0
FY2020

FY2021
Income gains

MITSUBISHI ESTATE CO., LTD.

FY2022
Capital gains

FY2023(F)Goals of
2030

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 area21

Progress of the Long-Term Management Plan

5. International Asset Business #2*Updated from FY2023 1Q IR Presentation

Rich pipelines in each area. Turn into profit at the right time.
Property Name＋Country

Type

Trinity Tower（Indonesia）
ALPHA PARK（China）
Capita Spring（Singapore）
180 George Street （Australia）
One City Centre（Thailand）
The Grand Outlet（Indonesia）
Parkline Place（Australia）
Suzhou New District Business Park (China)
One Circular Quay（Australia）
Oasis Central Sudirman （Indonesia）
Warwick Court（London）
8 Bishopsgate（London）

Asia

EuropeUS※1dMoura1（Spain）
Fyrkanten 11（Sweden）
60-72 Upper Ground（London）
Stateline 77 Building1・2 （South Carolina）
Hanover （Pennsylvania）
55 Paradise （New York）
Virginia Data Center Building （Building1）
Virginia Data Center Building （Building2）
Liv Crossroads （Arizona）
Liv Laveen （Arizona）
1158 Delaware （Colorado）
1072 West Peachtree （Georgia）
600 Fifth Street NW （Washington, D.C.）

Office, Commercial
OfficeMixed Use
Office, Commercial
Office, Commercial
OutletOffice, Commercial
OfficeHotel, etc.
Mixed Use
Renovation
Office, Commercial
OfficeRenovation
Office Commercial
Logistics
Logistics
Logistics
Data Center
Data Center
Rental Apartment
Rental Apartment
Rental Apartment
Mixed Use
Office…Project announced after the Long-Term Management Plan

Total Floor
Area※2
143,200㎡●

233,600㎡●

93,400㎡●※3*3 Leasable area

*4 Site area

MITSUBISHI ESTATE CO., LTD.

FY202355,000㎡●

116,000㎡●

49,000㎡●

11,000㎡●

7,800㎡

10,400㎡※393,600㎡※342,200㎡●※3

16,700㎡★

Book value of international assets ※1
in capital recycling business●★

¥847bil. at the end FY2022●★

●

360 Units★

★・・・Start Construction

●

●

●
★

34%

●

39%

●

★
★

●

28%

●・・・Completion※1 Inventories＋equity＋fixed assets*2 Total floor area unless otherwise noted.

*5 Total of two buildings

Approx.
\450 bn●

356 Units

37,000㎡

Approx.
\35 bn●51,000㎡

49,300㎡

●

★

※4

※3

Estimated Estimated･I
NOI･(Stable nvestment●

85,000㎡

250 Units

2030

●
★

29,000㎡

※3

〜

●

★

307,000㎡※5

FY2026●★

86,800㎡※3

FY2025●★

220,400㎡※3

FY2024★

65,900㎡

Red…Project added this quarter*１ Includes properties expected to be sold by 2030

FY2022※2 Excluding CORE Assets (Manhattan),ownership

the US ※2
EuropeAsia

subject to22

Progress of the Long-Term Management Plan

6. International Asset Business #3
Completion of a large-scale office building in London■Warwick Court (completed in Jul. 2022)

Development of various asset types in Australia■One Circular Quay

Project Features• First major renovation project in the U. K.
• Increased revenues from renovation of existing properties• Propose to enhance wellbeing and amenity facilities, andto comply with environmental and diversity requirements

Project Overview
Location: London, the U. K.

Use: Offices, retail properties

Floor area

: Approx. 29,000m2

Number of floors: 8 floors above ground, 2 floors below ground

Schedule: Completed in 2003, renovation began in Dec. 2020,
completed in Jul. 2022

▲Exterior photo（Jul. 2022）■8 Bishopsgate (construction to be completed in Feb. 2023)
Project Features

Project Features• High-rise office development in the central area ofLondon• Achieved nearly 2.8 times the leasable floor area of

8 Bishopsgate

the previous building with 40 years of experience inthe London market: London, the U. K.

Use: Offices, retail properties, observation gallery, etc.

Site area: Approx. 3,460m2

Floor area

: Approx. 85,000m2

Number of floors : 51 floors above ground (204m), 3 floors below
ground, 1 roof structure
Schedule: Construction began in Mar. 2019, to becompleted in Feb. 2023

MITSUBISHI ESTATE CO., LTD.

• Our project share is 66.7%. Large-scale project with sales of approximately￥285 bn.
• Rare location overlooking the Opera House and Harbor Bridge• Development of superb luxury

Project Overview
Location▲Image of the building▲Exterior phot
（Jul. 2022）

residential tower and five-star
hotel• Hilton's premier brand, theWaldorf Astoria, to open inAustralia for the first time
• Increasing investment in various
assets, including offices,
residences, and hotels in Australia

Project Overview
Location: Sydney, Australia

Site area: Approx. 4,100m2

Floor area

: Approx. 86,800m2

Number offloors: Residential building/ 59 floors above ground,
6 floors below ground
Hotel building/ 26 floors above ground, 6
floors below ground

Schedule: Construction to begin in early 2023, to becompleted in 2027

23

Progress of the Long-Term Management Plan

7. Non-asset (Fee-based) Business*Updated from FY2023 1Q IR Presentation

Significant growth led by increased profits from investment management businessdespite the large impact of COVID-19 to hotel business.
Business profit(long-term target) +¥50.0 bn(vs. initial forecast
for FY2020 (¥16.0 bn))

(Billions of yen)(Trillions of yen）+¥ 50.0 bn

32.3
40.0

-10.0

4
2

12.3

30.0

0.0

5.5

6

50.0

10.0

■Base income increase from AuM expansion• Achieved AuM ¥5.5 tn by 2Q 2023 and earlier achieved the mid-2020s targets
by 2Q 2023

60.0

20.0

Investment Management Business

15.7

9.3

12.2

10.7

4.4

5.9

-0.9

-7.3

-6.7

FY2020

FY2021

FY2022IM Business
MITSUBISHI ESTATE CO., LTD.

11.0
26.5
13.0

Hotel

-3.0
FY2023(F) Goals of
2030
Other

1.4

3.7
1.7

2.4

Domes
tic
International2.1

2.1

At the annoucement
FY2021of the Long-Term Management Plan
(January 2020)

FY2022

FY2023 2Q

1.7

5.0

3.4

2.0

0

21.0

3.1

4.5

Target AuMs
(Mid-2020s)■Includes incentive fees to receive in the future fromvalue-added funds
・A ¥18.5 bn incentive fees associated with real estate market valuation increase ofvalue-added funds in the U.S. etc. in FY2022 (details on p.84)
・Certain amount of incentive fees for FY2023 and beyond.

Hotels Business Heavily impacted by COVID-19 but gradual recovery is expected,
though it takes time.
Increased deficit in FY2021-FY2022 due to COVID-19 Management reforms
and a certain level of domestic demand recovery expected in FY2023.

24

Progress of the Long-Term Management Plan

8. Efforts to Improve Social Value #1*Updated from FY2022 IR Presentation announced on May 12, 2022

Raised reduction targets for GHG emissions in line with SBTi's new net-zero standards.
Certified as the first company in Japan by SBTi in June 2022.Substantially accelerated RE100
achievement timeline.
Before#1 Reduce CO2 emissions

FY2031 Plan

#2
R
E
1
0
0

RE100
achievement
timeline

After Review< Scope1,2 >35％
Reduction

70％+ Reduction 50％+ Reduction(from FY2020）（from FY2018）

2050 Target
SBTi scenario

MITSUBISHI ESTATE CO., LTD.

87％
Reduction（from FY2018）

Net zero declaration
Tighter scenarios（FY2031 Target：25％）(from FY2020）

Net Zero
Reduction in VC ︓Over 90％
Neutralization※1 ︓10％ or less

1.5℃ ScenarioLess than 2℃
Scenario

2050< Scope3 >(New Standard “Net Zero”）

Significant
acceleration

FY2026※1 Neutralize "residual emissions" that cannot be fully reduced by using

forest-derived absorption and carbon removal technologies, etc.

25

Progress of the Long-Term Management Plan

9. Efforts to Improve Social Value #2*Updated from FY2022 IR Presentation announced on May 12, 2022

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-zero standard
announced by SBTi. Certified as the first company in Japan 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

Reduction
within thevalue chain(VC)
More than70%

476 thousand
tons

RE100
Aiming toAchieve

FY20262050
Net Zero50%

VC reduction
Over 90%

2050
Net Zero
VC reduction
Over 90%
NeutralizationLess
than10%

Neutralization
Less than10%

FY2026FY2020

Reduction

3,560 thousand within VC
tons
More than【Measures】 Expectations for new energy and new technologies(e.g., Carbon neutral gas)”

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. 48％,
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”* 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 (FY22 Actual)
4.8%
Scope1︓Direct emissions by companies themselves
7.5%【Emissions】 Use of gas

Accelerate introduction of renewable energy to achieve RE100◆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.

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%
31%

40%
20%
0%

1.1% 3.1%
FY20

FY21

FY22

FY23
（F）

FY26
(Target)26

ESG Initiatives (Sustainability Initiatives)

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

27

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: 25% (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 FY0241, 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

28

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%

52.2%

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.

29

ESG Initiatives (Sustainability Initiatives)

3. Recent Highlights (The “E” in ESG)

1

Environment

All electricity at owned buildings in Tokyo, Yokohama to
be derived from renewables.
In FY2023, all of our office buildings
and commercial facilities* in Tokyo and
Yokohama will be powered byrenewables. Annual estimated CO2
reduction is approx. 340,000 tons
(equiv. about 120,000 average
households).

Issued first Sustainability Linked Bond
Accelerate the use of ESG finance to meet society's needs Raised ¥60 bn with its first issuance of Sustainability Linked Bonds in July 2022.
Japan's first credit to set targets based on SBTi's new net-zero standards and to
concurrently set targets for both environment (E) and diversity (S) in a single
framework

Overview of Sustainability Linked Bonds▲MARK IS Minatomirai*Over 50% owned buildings andcommercial facilities excluding
turnover-type and redeveloping
properties.
▲Toyosu Foresia

Issue
date

Issue
amountInterest
rate

5 years￥20.0 bn0.360%FY2026: Renewable electricity rate: 100%

10 years￥20.0 bn0.644%

FY2031︓Scope1,2 Reduce by over 70%
Reduce by over 50 % in Scope 3

30 years￥20.0 bn

1.543％

2050︓Achieve net zero
FY2051︓Achieve 40% of female managers▲Tokiwabashi Tower

First The Park House to meet "ZEH-M Ready" standards

Targets

Financing results using ESG finance
The Park House Shin-Urayasu Marine Villa
completed its first section in October 2021,
the first The Park House to meet "ZEH-M(Zetch Mansion) Ready" standards.
Improving building "energy-saving" together
with "energy creation" by solar power etc.
aiming 50% reduction of primary energy
consumption.
Aim to make all properties to be sold oroffered for lease ZEH-M Oriented or higher by
FY2026.

MITSUBISHI ESTATE CO., LTD.

Issue Date

▲The Park House Shin-Urayasu Marine Villa

Bond type

AmountfinansedJun. 2018

Green Bonds (publicly-offered bonds)￥20.0 bn

May 2020

Sustainability Linked Loan

￥11.5 bn

Nov. 2021

Positive Impact Financing￥5.0 bn

Jul. 2022

Sustainability Linked Bonds￥60.0 bn

Oct. 2022

Sustainability Linked Loan

￥50.0 bn
30

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%

24.3%

24.6%

31.4%

30.0%

22.9%

20.0%
10.0%
0.0%

KPI

26.0%

20.3%

21.1%

5.5%

5.8%

6.6%

FY2020

FY2021

FY2022

15.9%

16.9%

5.7%
FY201938.3%①

Percentage of female managers*1: over 20% by FY2031, over 30% by
FY0241, over 40% by FY2051②

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

Enhancing personnel systems to create a better working environment 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.

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

Supplier Code of Conduct
Established the Mitsubishi Estate Group Supplier Code of
Conduct on April 1, 2022 to promote sustainability and ESGrelated initiatives throughout our supply chain.
As challenges like human rights, labor and climate change
grow serious, the code 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 thestatus 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, andinvite relevant suppliers for improvement initiatives.
*Criteria for determining that there is a strong tendency to increasesustainability risk
1.The employment of foreign workers, technical intern trainees, andother workers whose positions tend to be weak is assumed.
2. Businesses with high environmental impact
3. There are cases where it is difficult to identify and identify risks dueto the multiple outsourcing structure.
31

ESG Initiatives (Sustainability Initiatives)

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

3

Innovation

New business creation through open innovation with startups■New startup investment fund launch
Launched "BRICKS FUND TOKYO by Mitsubishi Estate" to invest
in startups working to create a mid-to-long term social impact
by solving social challenges and industrial restructuring. About ¥10 bn investmentin the next 5 years with an expected cumulative total investment in startups andventure capital to reach ¥50 bn (including confirmed investment) by mid-2020s.

Online training platform and DX human resource development
for all employees■Online training platform "MEC ACADEMY"
Established a new online training platform, MEC ACADEMY, to share corporatewide collective knowledge of real estate and other businesses. Encouraged
employees to explore new challenges through cross-organizational knowledge,
skills, and experience sharing, including in the real estate business.

■Established "MEDiA (MEC Digital Academy)," a DX humanresources development programDX human resource development program "MEDiA" on "MEC.
ACADEMY"Conducted largely-enhanced programs in the digital domain for all
Group employees of approx.10,000.

4Resilience

Conducted the 96th Emergency Drills
Annual emergency drill conducted with public and private sectors, involving all
executives and employees of Mitsubishi Estate, group companies, and external
parties. FY2023 emergency drill and practical exercises held first time in three
years, participated by Chiyoda Medical Association and Marunouchi Fire Station.
Information gathering in times of disaster using the next-generation multiplecamera control system installed in the Marunouchi area, firefighting exercises
held at the first time such as ladder truck rescue drill and simultaneous water
discharges at Tokiwabashi Tower completed in June 2021 .

Rain Garden demonstration experiment on Marunouchi Nakadori Ave.
Rain Garden demonstration experiment as part ofgreen infrastructure initiatives, using roadside planting
strips on Marunouchi Naka-dori Ave. Rain Garden is a
project to temporarily store rainwater and allow it topercolate underground over time. This study
verifies the possibility of solving various urban issues
such as reducing the risk of flooding, heat island, andcontributing to biodiversity.

Content: Five courses ranging from "Basic," "Practical," and"Advanced"
STEP1①Digital marketing (Digima) training (Basic)

STEP2②Digima training (Practical), ③ Data analysis program, ④DX online program

STEP3⑤Boot camp

MITSUBISHI ESTATE CO., LTD.

▲Effect of rain gardens▲Photo ofmaintenance work

32

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• 15 directors: 8 company directors and 7 independent outside
directors (10 of which are non-executive directors)• Chairpersons of all committees are independent outside directors• 5 of 7 independent outside directors are male and 2 are female

Board Structure

Composition of Male/Female
From June 29, 2022

5

7
3

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

MITSUBISHI ESTATE CO., LTD.

1

2

14
Male

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

Audit
Committee

Remuneration
Committee

Exclusively
outside directors

Chairperson is an
outside director

Exclusively
outside directors

13
Female: Outside Director: Company Director(Non-executive): Chairperson

33

ESG Initiatives (Sustainability Initiatives)

7. Corporate Governance (The “G" in ESG) #2
Strategic-Holding Stock Policies• Sold 25 *entities with a total value of approx. ¥29.1 bn in thepast four years (FY2019-FY2022)• Approx. ¥244.2 bn (market value) of listed stock as of March 31,
2022. 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

164

4

8

152

148

16

22

30

34

138

134

133

129

FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022
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.

34

ESG Initiatives

8. External Evaluations
As of September 2022
Category― Not selected
Benchmarks※ Before announcement

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 Asia Pacific Index

●

●

※

ESG in General

Member of the "S&P Global Sustainability Yearbook"

●

●

※

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 *1

5 Star

5 Star

5 Star

ESG in General

GRESB Development Benchmark *1

4 Star

5 Star

4 StarE (Environment)

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

●

●

●

E (Environment)

CDP Climate Change

A

A-

※

E (Environment)

CDP Water Security

―

A-

※

S (Society)

MSCI Japan Empowering Women Select Index (Adopted by
GPIF)

●

●

●

5 years in a row

5 years in a row*1 For GRESB, the evaluation system differs between before 2019 and after 2020.
*2 Evaluation results in the Real Estate Assessment*3 Started assigning ratings from 2020

MITSUBISHI ESTATE CO., LTD.

35

Financial Supplemental Data

MITSUBISHI ESTATE CO., LTD.

36

Financial Supplemental Data

1. Management Index, etc.
①KPI for 2030 Target
2019/32020/32021/32022/32023/3（F）

2030(Target)

ROA*1

4.0%

4.1%

3.8%

4.4%

4.4%

5％

ROE

7.8%

8.5%

7.6%

8.1%

8.0%

10％

EPS

¥ 96.97¥ 108.64¥ 101.34¥ 116.45¥ 124.75¥ 200②Business
Profits

2019/32020/32021/32022/32023/3（F）

Business
profits*2¥ 229.4 bn¥ 240.9 bn¥ 224.7 bn¥ 279.3 bn¥ 291.4 bn¥ 350.0〜
400.0 bn

2030
(Target)Domestic AssetBusiness-¥ 201.5 bn¥ 201.6 bn¥ 215.8 bn¥ 203.4 bn

Approx. ¥50 bn+*3

International
Assets Business-¥ 46.1 bn¥ 37.9 bn¥ 55.8 bn¥ 94.0 bn

Approx. ¥50 bn+*3

Non-asset
Bussines-¥ 15.7 bn¥ 9.3 bn

¥ 32.2 bn¥ 21.0 bn

Approx. ¥50 bn+*3

Eliminations or
corporate-(¥ 22.4 bn)(¥ 24.2 bn)(¥ 24.5 bn)(¥ 27.0 bn)-*1 ROA = Business Profit / Total assets (average)

MITSUBISHI ESTATE CO., LTD.

*2 Business Profit = Operating Profit + Equity in Net Earnings/Loss (for unconsolidated subsidiaries and affiliates)*3 vs FY2020

37

Financial Supplemental Data

2. Balance Sheet As of September 30, 2022
Millions of yen (rounded down)

Current assets
Cash and deposits
Trade notes and accounts
receivable, and contract assets
Real estate for sale
Real estate for sale in progress
Real estate for development
Equity investments
Other
Non-current assets
Total property, plant and equipment
Total intangible assets

As of
As of March
September
31, 2022
30, 2022
1,628,428
1,356,789
275,478
233,117

Investment securities
Other
Total assets

Millions of yen (rounded down)

Change271,638
42,36149,06360,645(11,581)

44,214
456,715719
705,455
96,7815,275,518
4,467,844
108,175
287,316
412,181
6,903,947

41,239299,532724
624,52197,0095,137,127
4,345,989
108,092
299,617
383,426
6,493,917

2,974
157,183(5)
80,933(228)
138,391
121,855
82(12,300)
28,753410,030

Liabilities
Current liabilities
Trade notes and accounts payable
Short-term borrowings
Current portion of long-termborrowings
Commercial Papers
Current portion of bonds payable
Other
Non-current liabilities
Bonds payable
Long-term borrowings
Other
Net assets
Shareholdersʼ equity
Accumulated other comprehensive income

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

Total Assets（End of September 2022）

Others440,073

Consolidated Interest-Bearing Debt
Lease Obligations
1,669
Commercial Papers
200,000

International Business
1,347,629

6,903,947
Residential Business
818,032
Commercial Property Business
4,298,213
MITSUBISHI ESTATE CO., LTD.

（End of September 2022）

Bonds
867,418

2,986,764
Loans
1,917,677

Consolidated Interest-Bearing Debt
Fixed/Floating Rate Ratio（End of September 2022）

As of
As of March
September
31, 2022
30, 2022
4,501,077
4,257,484
924,362
631,043
44,66260,516
166,940
182,052

Change243,592
293,319(15,854)(15,111)

234,663

79,928

154,734

200,000
40,000238,096
3,576,714
827,418
1,516,073
1,233,219
2,402,869
1,383,344
767,712
193
251,620
6,903,947

90,000218,5443,626,441
786,335
1,598,562
1,241,539
2,236,432
1,335,024
668,200
201
233,005
6,493,917

200,000(50,000)
19,552(49,726)
41,083(82,488)(8,323)
166,437
48,31999,511(8)
18,614410,030

Consolidated Interest-Bearing Debt
Long-term/Short-term Ratio（End of September 2022）

Short-term
12.3%

Floating
20.0%

2,986,764
Fixed
80.0%

2,986,764
Long-term
87.7%

38

Financial Supplemental Data

3. Asset Compositions(End of September 2022)

Inventories

Equity Investments

Property, plant andequipment

8%
23%

28%

6%
13%

12%
3%

3%
0.4%

¥

509.7 billion¥

705.4 billion

6%

3%
2%
3%

¥

4,467.8 billion
70%

74%
46%

Domestic Condominiums
EuropeAsia
OthersMITSUBISHI ESTATE CO., LTD.

Domestic (office buildings)
Domestic (others)
US
EuropeAsia

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

39

Financial Supplemental Data

4. Consolidated Cash FlowMillions of yen (rounded down)①FY20222Q
Results②FY20232Q
Results

Change（②－①）

61,935

11,993(49,942)

Depreciation

44,96546,084

Decrease (increase) ininventories

31,924

Decrease (Increase) in equity
investments④FY2023
Forecasts

Change（④－③）

280,090370,000

89,9101,119

91,581

94,0002,419(133,010)(164,934)

116,993

102,000(14,993)(7,649)24,92832,578(30,267)(66,000)(35,733)(174,465)(144,875)

29,589(313,778)(480,000)(166,222)

6,119

845

(5,273)

9,562

2,000

(7,562)(170,903)(146,612)

24,290(329,115)(459,000)(129,885)

Cash Flows From
Financing Activities

159,435

164,697

5,262

90,97315,000(75,973)

Cash and Cash Equivalents
at End of Period

224,084

277,126

53,041

234,244

140,000(94,244)(112,529)(132,882)(20,353)(33,687)(110,000)(76,313)

Cash Flows From
Operating Activities

Cash Flows From
Investing Activities
Proceeds from sales ofinvestment securities
Purchase of property, plantand equipment

Free Cash Flow

MITSUBISHI ESTATE CO., LTD.

③FY2022
Results

40

Financial Supplemental Data

5. Investment Data
Major Breakdown of Purchase of Property,
Plant and Equipment(Billions of yen)(Billions of yen)

500.0

459.0

500.0
450.0

450.0
70.0

400.0

331.8

350.0
300.0

Major Breakdown of Equity Investments

10.7

285.0
6.5
13.0

250.0

12.3
9.0

113.8

74.7

200.0
150.0
100.0
50.0

329.1

319.8
4.3

4.3
6.1

8.1
25.2
47.4

38.4

39.9

36.9
16.8
21.3

47.8

76.9

15.6
23.9

19.2

68.4

63.5

72.4

FY2020

FY2021*

350.0

105.0

300.0

112.5

250.0
70.0

70.6

51.0
77.4
14.2
63.6

84.0
23.0
71.0

0.0
FY2019FY2022

400.0

20.0
16.0

FY2023(F)

200.0

140.0

150.0

99.4

100.0
50.0

75.1

0.0

13.2
FY20192.3
8.8

FY2020

93.7

83.9

2.1

49.0

1.1

60.7 19.3
2.8

42.6
FY2021*25.0

FY20224.0

57.0
42.0 12.0
FY2023(F)*Classifications have been changed below from FY2021<Legend for FY2021 - ><Legend for FY2018 – 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.

41

Financial Supplemental Data

6. Income Generating Assets Unrealized Gains: Current Status #1
Increased unrealized gains from new buildings, lower cap rates for overseas assets
and domestic rental housing, and foreign exchange rates.
Income Generating Assets Unrealized Gain
(Billions of yen)Book value

Unrealized gain

9,000
7,941.1

8,000

8,361.2

6,079.0
2,963.5

3,422.8

3,898.4

4,222.5

4,250.2

4,573.2

3,935
3,504

2,569.0

3,606

3,241

3,300

2,950
2,643

2,800
2,384

4,000

2,300

3,000
2,000

Adjusted BPS

3,800

6,791.9

6,000

BPS

(Yen)
4,300

7,383.4

7,000

5,000

8,270.8

8,840.4

BPS and Adjusted BPS*

1,800
3,509.9

3,828.4

3,960.5

4,042.7

4,048.3

4,110.9

4,267.1
1,300

1,088

1,148

FY2016FY2017

1,224

1,276

1,269

FY2018FY2019FY2020

1,383

1,515

1,000
0

800
FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2021

FY2022＊ BPS including unrealized gains (after tax)

MITSUBISHI ESTATE CO., LTD.

42

Financial Supplemental Data

7. Income Generating Assets #2

Unrealized Gain Breakdown

Profit Trends(Billion of yen)
190

International
11%

180

180.5

180.2

FY2020

FY2021

184.3

174.8
168.3

170
160.7

Domestic(Outside of Marunouchi)
18%

160

Marunouchi
New building*52%

Marunouchi
Existing Building*
19%

150
140

136.2

130
120
110
100
FY2016FY2017FY2018FY2019FY2022*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 new Marunouchi building.
(FY2022 Results)
MITSUBISHI ESTATE CO., LTD.

43

Business Overview

MITSUBISHI ESTATE CO., LTD.

44

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.

45

Business Overview

2. Business Scale

Investment
Management
Business3%*Other5%

Investment
Management
Business
9%International
Business
9%International
Business
18%

Revenue fromOperations¥1,349.4
billionInternational
Business
18%

Total Assets

Operating Profit

Approx.

Approx.

Residential
Business
28%

Investment
Management *Other
1%
Business2%*Other0%

Commercial
Property
Business
55%¥278.9Residential
Business
10%

billionCommercial
Property
Business
63%

Residential
Business
11%

Approx.

¥6,493.9
billionCommercial
Property
Business
68%*Architectural Design & Engineering Business and Real Estate Services Business, Other Business（FY2022 Results）

MITSUBISHI ESTATE CO., LTD.

46

Commercial Property Business
Office Buildings

MITSUBISHI ESTATE CO., LTD.

47

Commercial Property Business (Office Buildings)

1. Marunouchi Area Map

MITSUBISHI ESTATE CO., LTD.

48

Commercial Property Business (Office Buildings)

2. Pipeline
Mizuho Marunouchi Tower,
Ginko Kaikan,
Marunouchi Terrace(Tentative name)Tokiwabashi Tower
Bldg. A

Marunouchi Area

Uchikanda 1-chome
Project

Yurakucho
Redevelopment(TBD)

Project Movie
Introduction ofTOKYO TORCH

https://www.youtube.com/watch?v=IN2wMPigqjMTotal Floor Area: 180,900㎡
Completion: Sep. 2020

FY2020Total Floor Area: 146,000㎡
Completion: Jun. 2021

FY2021

Total Floor Area: 85,200㎡
Completion: Nov. 2025

FY2022

Total Floor Area: 544,000㎡
Completion: FY2028

FY2023

FY2024(Tentative name)

FY2028(Tentative name)

Link Square Shinjuku

CO･MO･RE YOTSUYA

the ARGYLE aoyama

Toyosu 4-2 Project

Akasaka 2 ・ 6-chome
Development Plan

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

Total Floor Area: 139,600㎡
Completion: Jan. 2020

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

Total Floor Area: 136,000㎡
Completion: Jun. 2025

Total Floor Area︓210,000㎡
Completion︓FY2029

Tokyo(Outside of Marunouchi)

Torch Tower Bldg. B

MITSUBISHI ESTATE CO., LTD.

49

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 3,769

4,175

4,896

5,580 5,670

5,038

5,174

5,385

5,570

5,745

3,000

2,565 2,565

2,000

1,677

1,798

1,946 2,024 1,897

500

256

256

355

489

489

2,687 2,758 2,755

2,195 2,258

2,583 2,531

2,727 2,784

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

1,705 1,705

1,500
1,000

5,991 6,040 5,913

4,347

3,500

2,500

5,869

743

743

1,022 1,022

1,174

1,836 1,836 1,872

1,987

1,383 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.

50

Commercial Property Business (Office Buildings)

4. Earnings Related Data: Vacancy Rates and Average Rents (Unconsolidated)(yen / tsubo-month)

Vacancy Rates (Marunouchi Offices/All uses in Japan) and
Average Rents (All uses in Japan)

30,000Vacancy rate (Marunouchi offices)

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

26,00024,86424,00022,00022,602
21,902 21,711

25,842
24,42323,56026,193

26,702

27,177

27,79328,22828,58529,0008%
7%25,23423,974 23,850

9%23,861 23,587

6%

5.29%

21,733

5%

4.50%
3.98%

3.59%

20,00018,000

2.77%

3.40%

3.58% 3.58%

2.86%

2.77%

4.32%
3.66%

2.50%

4.42%

3.5%

3.29%

1.87%
2.42% 2.26%

1.74%
1.09%
0.55%

2.19%

2.22%

16,00012,000

2.93%

2.80%

1.68% 2.06%

14,000

3.33%

0.19%

2.42%

2.42%
1.82%
1.37%

2.35%
1.65% 1.80%

3%
2%

1.07%

1%
0.69%

05/3 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 22/9 23/3
(F)

MITSUBISHI ESTATE CO., LTD.

4%

0%

51

Commercial Property Business (Office Buildings)

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

FY2022-2Q
Results

FY2022
Results

FY2023-2Q
Results

FY2023
Forecasts

Rent revenue from office buildings*

215.9

435.2

213.5

423.7

Changes from the previous period+ 7.8+ 17.1(2.4)(11.4)

Rent revenue from new buildings+ 8.4+ 16.0

+ 3.6

+ 6.2

Rent revenue from existing buildings

(2.2)

(6.7)

(4.9)

(6.7)

Termination of master lease,closure of building for redevelopment

(1.8)

(3.4)

(2.6)

(8.4)

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

(0.4)

(3.3)

(2.3)

+ 1.7

Supplementary revenue, incl. common
area charge・Others

+ 1.6

+ 7.8

(1.1)

(10.9)* Office buildings, incl. those with retail areas, etc.

MITSUBISHI ESTATE CO., LTD.

52

Commercial Property Business (Office Buildings)

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

30
25

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

+0.3

20
15

+15.3

+14.7
+23.9

10
+15.3
5

+8.7

0
-4.9
-5

-1.1
-5.9

+12.5

+7.3
+1.9

+27.2

+6.0

+7.3

-1.5

-1.5

-10.5

-4.0
-2.5

-5.4

-4.6
-5.6

-10

+9.5

-5.2
-6.0

+6.6
-3.4

-0.7
-7.5

+22.6 +0.7 +17.9+10.8+18.5 +13.2

+2.4
-9.0

+4.9

Total

+12.2

+9.8

+4.0

+4.7

+16.0
+5.9

+6.5

-10.5

-5.5

-8.1

+6.2

+8.0
-0.7

+1.7
-3.3
-3.4

-8.4

+3.6
-2.3
-2.6

-8.3

*1 Office buildings, incl. those with retail areas, etc.

-15
-20

+0.3

*2 Retail properties in office buildings

05/3

06/3

07/3

(1.6)

+8.3

(1.3)

MITSUBISHI ESTATE CO., LTD.

08/3

09/3

10/3

11/3

12/3

13/3

+19.8 +20.5 +17.4

+2.3

(1.7)

(5.1)

14/3

15/3

16/3

+19.0 +11.9

+7.6

17/3

18/3

19/3

20/3

21/3

22/3

23/3
（F）

23/3-2Q+18.5 +15.2 +24.1 +17.6 +14.0 ＋9.3

(0.5)

(1.3)

53

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.

54

Commercial Property Business (Office Buildings)

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

30,000

9.19%

10%

8.75%

28,000

Average Rent

9.04%

Vacancy Rate

8.56%

9%
8%

26,000
6.49%

6.70%

24,00022,57422,00021,2955.51%

18,264
17,495
17,1954.34%
16,71616,504
16,32516,0002.72%

14,000

6%

4%
3.60%

3.41%

7%

5%

5.42%

17,973 18,730

18,095
17,593

20,366
20,156

19,69920,00018,00021,541

21,134

5.30%

6.05%

20,064

6.37%

22,594

2.89%

3%
2.80%

2%

1.78%

12,000

1%

1.50%

0%

10,000
05/3

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

22/9

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

55

Commercial Property Business (Office Buildings)

9. Competitive Edge of Marunouchi: Vacancy Rates
5 Central Wards of Tokyo (Market) vs. Marunouchi(Unconsolidated)
10%
8.75%

9%

9.19% 9.04%
8.56%

8%
6.70%

7%
6%

6.37%
5.51%
6.05%

2.77%
1.74%

2.72%

4.34%

3.66%

3.41%

3%

2.42%

2.89%

3.33%
3.60%

2.26%
2.42%

1.09%

2.42%
1.82%

1%
0%

4.42%

4.32%

4%

2%

5.42%

5.30%

5%

0.55%
05/3

06/3

07/3

2.80%

09/3

2.50%

2.19%
1.65%

1.50%
1.78%

1.37%

0.69%

0.19%
08/3

6.49%

10/3

11/3

12/3

13/3

5 Central Wards of Tokyo (Market)

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

22/3

22/9

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

MITSUBISHI ESTATE CO., LTD.

56

Commercial Property Business (Office Buildings)

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

Marunouchi

Nihonbashi

ShinagawaShibuya

Toranomon

2,400m
1,500m

Area:

120ha

Area:

76ha

Area:

49ha

Area:

86ha

Area:

58ha

Railway lines:

28 lines

Railway lines:

5 lines

Railway lines:

9 lines

Railway lines:

8 lines

Railway lines:

2 lines©Open Street Map

MITSUBISHI ESTATE CO., LTD.

57

Commercial Property Business (Office Buildings)

11. 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

058

Commercial Property Business (Office Buildings)

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

Type of Business

Area ratio

March 2022

Type of Business

Area ratio

1

Manufacturing

42.5%

1

Finance23.7%

2

Finance22.2%

2

Manufacturing

22.9%

3

Trading

10.4%

3

Professional Firm

19.7%

4

Information

6.3%

4

Trading

9.2%

5Professional Firm

4.4%

5

Information

9.0%

Others

14.2%

Others15.5%

Contracted area
Approx. 835 th m2（office）

Contracted area
（office）

Approx. 1,557 th m2

Others 15.5%
Finance23.7%
Others 14.2%
Professional Firm
4.4%
Information
6.3%
Trading
10.4%

March 2000
Contracted area

835 th m2

March 2022
Contracted area
Approx.

Trading
9.2%

Approx.

Finance 22.2%

MITSUBISHI ESTATE CO., LTD.

Information
9.0%

Manufacturing
42.5%

Professional Firm
19.7%

1,557 th m2
Manufacturing
22.9%

59

Commercial Property Business (Office Buildings)

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

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

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

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

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

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

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

Hotels60

Commercial Property Business (Office Buildings)

14. Initiatives Looking Ahead to Post-COVID-19
Enhancing value in the office by sophisticating the core functions of the central office andadapting to diversified workstyles.
Previous workstyles

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

Work at a predeterminedplace and time.

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

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

Approaches to diversified workstyles
WORK × ation Site
(Workation)

Telecubes• ・ Increase
installment• numbers• ・ Expand
installation spots
to condominiums
etc.

• Establishment of a
new hub

NINJA SPACE
・To locate
workspaces

MITSUBISHI ESTATE CO., LTD.

CIRCLES（Compact office）•

Aim is to develop 30
buildings by 2024

61

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

MITSUBISHI ESTATE CO., LTD.

62

Commercial Property Business (Outlet Malls)

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

Changes in sales-linked & fixed ratio(average for all facilities)(㎡)

50,000350,000

45,000

325,000

40,000300,000

35,000275,000

50%

50%

47%

38%

38%

50%

50%

53%

62%

62%

FY2018FY2019FY2020

FY2021

FY2022

Fixed rent
30,000

Sales-linked rent

250,000

Changes in ROA・Total Assets
25,000225,000(Billions of yen)20%
20,000175,000

17/3

18/3

19/3

20/3

21/3

22/3

Store area

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

Revenue fromOperations

43,642

45,462

46,65946,39340,03044,177

Operating Income 17,359

18,94019,673

18,963

14,61916,789MITSUBISHI ESTATE CO., LTD.

18.0%

200,000

15,00010,00017.9%

150,000

150

17.3%

15%

12.6%

13.6%

100

10%

50

5%

0
FY2018FY2019FY2020

FY2021

Total Asset (right axis)

ROA

FY202263

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

284,600㎡

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

176,800㎡

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.

64Commercial Property Business (Logistics Facilities)

3. Logistics Facility Business #1
Trends in Gain on Sales

Total Assets＜End of March 2020＞(Billions of yen)
8.0

8.0

8.0

Assets inOperation
36%
Assets under

4.0

development
64%

2.0

0.0

27 billion

Approx. ¥84 billion

7.0

6.0

4.0

Approx. ¥＜End of March 2022＞（2 buildings)(8 buildings)
FY2019FY2020Tokyo Ryutsu Center Distribution Building B
MITSUBISHI ESTATE CO., LTD.

FY2021

FY2022

Assets underdevelopment
45%(10 buildings)

Assets inOperation
55%（7 buildings)*Ratio by value*Excl. Tokyo Ryutsu Center

Logicross Zama Komatsubara

Logicross Zama

65

Commercial Property Business (Logistics Facilities)

4. Logistics Facility Business #2
Completed properties
Name

Location

Tokyo Ryutsu Center Distribution B Building

Ota, Tokyo

Logicross Ebina
Logicross Hasuda
Logista・ Logicross Ibaraki Saito A Building
Logista・ Logicross Ibaraki Saito B Building
Logicross Zama Komatsubara

Ebina, Kanagawa
Hasuda, Saitama
Ibaraki, Osaka
Ibaraki, Osaka
Zama, Kanagawa

Site Area

Total Floor Area

Construction
Start Date

Completion
Date-

171,300㎡-

Jun. 201730,100㎡
49,500㎡
51,000㎡
15,800㎡
21,900㎡

61,900㎡
78,600㎡
116,000㎡
31,200㎡
44,300㎡

Nov. 2019Feb. 2020Feb. 2020
May 2020
Nov. 2020

Nov. 2020
Mar. 2021
May 2021
May 2021
Mar. 2022

Total Floor Area

Construction
Start Date

Completion
Date-

205,000㎡

Dec. 2021

Aug. 2023

Projects under development
Name

Location

Site Area

Tokyo Ryutsu Center Distribution Building New Bldg. A

Ota, Tokyo

Logicross Osaka Katano
Logicross Zama Project

Katano, Osaka
Zama, Kanagawa

10,200㎡
80,900㎡

20,800㎡
178,700㎡

Nov. 2021
Apr. 2022

Nov. 2022
Nov. 2023

Logicross Sagamihara

Sagamihara, Kanagawa

78,100㎡

170,900㎡

Jun. 2022

Dec. 2023(Tentative name) Kyoto Joyo Core Logistics Facility

Joyo, Kyoto

119,000㎡

277,000㎡

2025

2026

Tokyo Ryutsu Center Distribution Building
New Bldg. A

MITSUBISHI ESTATE CO., LTD.

Logicross Sagamihara

66

Commercial Property Business (Hotels)

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

Royal Park Hotels Number of Rooms(published projects)（rooms）

3,815

4,129

4,414

3,399
2,434

2,434

（Billions of yen）

1.4

2,809

0.5

0.5

-0.9

FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

FY2017FY2018FY2019FY2020-7.3
FY2021-6.7
FY2022

Hotels opened in each period

The Royal Park Canvas Sapporo Odori Park

MITSUBISHI ESTATE CO., LTD.

The Royal Park Hotel Iconic Kyoto

FY2017FY2018FY2019FY2020

FY2021

FY20220 bldgs

0 bldgs

3 bldgs

2 bldgs

2 bldgs

2 bldgs

Kyoto
Shijo
Hiroshima
RS
Ginza 8Osaka
Kobe
Kyoto Nijo
Kitahama Sannomiya Sapporo
Odori Park
Osaka
Kyoto
MidosujiUmekoji67

Commercial Property Business (Hotels)

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

Information Movie

Guidance Video Of Royal Park Hotels

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

Name

Location

Number of Rooms

Open

419

Jun. 1989

Yokohama, Kanagawa

603

Sep. 1993

Sendai, Miyagi

110

Apr. 1995

The Royal Park Hotel Iconic Tokyo Shiodome

Minato, Tokyo

490

Jul. 2003

Marunouchi Hotel
The Royal Park Hotel Fukuoka

Chiyoda, Tokyo

205

Oct. 2004

Fukuoka, Fukuoka

174

Jul. 2011

The Royal Park Hotel Kyoto Sanjo

Kyoto, Kyoto

172

Oct. 2011

The Royal Park Canvas Nagoya
The Royal Park Hotel Tokyo Haneda

Nagoya, Aichi

153

Nov. 2013

Ota, Tokyo

313

Sep. 2014

The Royal Park Hotel Kyoto Shijo

Kyoto, Kyoto

127

Apr. 2018

The Royal Park Hotel Hiroshima Riverside

Hiroshima, Hiroshima

127

The Royal Park Canvas Ginza 8

Chuo, Tokyo

121

Oct. 2018
Mar. 2019

The Royal Park Canvas Osaka Kitahama

Osaka, Osaka

238

Jun. 2019

The Royal Park Hotel Iconic Osaka Midosuji

Osaka, Osaka

352

Mar. 2020

The Royal Park Canvas Kobe Sannomiya

Kobe, Hyogo

170

Jan. 2021

The Royal Park Hotel Kyoto Umekoji

Kyoto, Kyoto

246

Mar. 2021
Jun. 2021

Royal Park HotelChuo, Tokyo

Yokohama Royal Park Hotel
Sendai Royal Park Hotel

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 ParkThe Royal Park Canvas Kyoto Nijo

Kyoto, Kyoto

180

The Royal Park Canvas Sapporo Odori Park

Sapporo, Hokkaido

134

Oct. 2021

The Royal Park Hotel Iconic Kyoto

Kyoto, Kyoto

125

Apr. 2022

The Royal Park Hotel Canvas Ginza Corridor

Chuo, Tokyo

160

Nov. 2022

Nagoya Sakae Hotel Project

Nagoya, Aichi

250

FY2025

Hotel Development Business （Domestic Asset Business）
Name

Hotel Okura Kyoto Okazaki Bettei
MITSUBISHI ESTATE CO., LTD.

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

2023
2024

68

Residential Business

MITSUBISHI ESTATE CO., LTD.

69

Residential Business1. Condominium Business Data #1
Due to a decline in the land bank, sales and profits in FY2023 were significantly lower YoY. Shiftthe immediate profit focus of the Residential Business to capital gains (e.g., rental apartments.).
FY2022-2Q(Results)

FY2022(Results)

FY2023-2Q(Results)

FY2023(Forecasts)

Land Bank
Breakdown in ReportingTerm(As of September30, 2022)

Condominiums Sold(millions of yen) *1 *3Condominiums Sold
(units)53,624

216,231

33,319115,000

742

3,046

338

1,600

5,800

5,300

Gross Margin *2 *3

23.0%

22.5%

26.0%

23.1%

Inventory (units)

111

62

19

-

New Supply of
Condominiums(units)

878

2,131

1,018

1,900

4,400

Total: 15,500 units
FY2023 - FY2025
FY2026 - FY2028

FY2029 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.
*1*2

MITSUBISHI ESTATE CO., LTD.

70

Residential Business

2. Condominium Business Data #2
Scheduled for delivery in FY2023
Name (Project Name)

Location

Site Area

Total Units

Scheduled
Delivery

The Parkhouse Jiyugaoka Diana Garden

Meguro, Tokyo

3,600㎡

44Aug. 2022

The Parkhouse Shin-Urayasu Marine Villa (2 construction areas)

Urayasu, Chiba

47,100㎡*294

Nov. 2022

The Parkhouse Nagoya (2 construction areas)

Nishi, Nagoya

18,100㎡*

148

Feb. 2023

The Parkhouse Takanawa Matsugaoka

Minato, Tokyo

2,300㎡

73

Mar. 2023

The Parkhouse Fuchu

Fuchu, Tokyo

2,800㎡

182

Mar. 2023*Total occupying area

The Parkhouse Jiyugaoka Diana Garden
MITSUBISHI ESTATE CO., LTD.

The Parkhouse Nagoya

71

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

260,000

242,859

240,000
220,000
200,000
180,000
160,000
140,000
120,000

91.5%
83.3%
71.9%

58.2%

206,684

216,231207,004

97.7%
93.1%

90.9%

91.1%

83.5%

84.6%

79.8%
68.8%

69.4%

64.5%

62.9%

100,000

115,000 (F)
92.4%

50.4%

80,00081.3%

60,00061.1%

40,00020,0000FY2019FY2020Full-Year sales

MITSUBISHI ESTATE CO., LTD.

FY2021
End of 3Q

End of 2Q

FY2022End of 1Q

FY2023

Beginning of FY

72

Residential Business4. Condominium Market Data
Number of New Supplies/Average Prices (the Greater Tokyo Area)(Unit)(Average price/Millions of yen)70

140,000

120,000

62.6

60

100,000

50

80,00040

60,00030
34,00040,00033,63610

20,0000201999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
(F)

Number of new supplies

0

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

MITSUBISHI ESTATE CO., LTD.

73

Residential Business

5. Rental apartments businessTotal Assets
Approx. ¥140 billion

Assets underdevelopment
39%(45 buildings)

Assets in Operation
61%(35 buildings)(End of March 2022)*Ratio by value

Parkhabio Akasaka Tower

Property list

Trends in Gain on Sale
Name

(Billions of yen)

Parkhabio Monzen Nakacho
Parkhabio Iidabashi
Parkhabio Akasaka Tower
20
Parkhabio Akihabara Est
22
The Parkhabio Ueno Okachimachi
15
The Parkhabio Shinagawa Togoshi
The Parkhabio Nihonbashi Kodenmacho
The Parkhabio Nihonbashi Hakozakicho
10
The Parkhabio Waseda
11
10
The Parkhabio Sugamo
57
The Parkhabio Ebisu Place
5
The Parkhabio Nishiyokohama
0
The Parkhabio Meguro Fort
FY2019FY2020
FY2021
FY2022 FY2023(F)The Parkhabio Kiba
*Trends in capital gains for Residential Business The Parkhabio Nihonbashi Bakurocho
The Parkhabio Kagurazaka Kazuki
The Parkhabio Sangenjaya
The Parkhabio Akabane
The Parkhabio Kamata
The Parkhabio Komagome
The Parkhabio Sumiyoshi
The Parkhabio Kagurazaka
The Parkhabio Himonya
The Parkhabio Nishiooi
The Parkhabio Shin-okachimachi
The Parkhabio Yoyogi Hatsudai

25

The Parkhabio Kiba

Location

Total Units

Koto, Tokyo
Chiyoda, Tokyo
Minato, Tokyo
Taito, Tokyo
Taito, Tokyo
Shinagawa, Tokyo
Chuo, Tokyo
Chuo, Tokyo
Shinjuku, Tokyo
Toshima, Tokyo
Shibuya, Tokyo
Yokohama, Kanagawa
Meguro, Tokyo
Koto, Tokyo
Chuo, Tokyo
Shinjuku, Tokyo
Setagaya, Tokyo
Kita, Tokyo
Ota, Tokyo
Kita, Tokyo
Sumida, Tokyo
Shinjuku, Tokyo
Meguro, Tokyo
Shinagawa, Tokyo
Taito, Tokyo
Shibuya, Tokyo

129
113
212
54
72
36
44
50
99
188
71
81
27
223
110
77
63
39
60
42
63
54
44
85
93
78

Completion
Date
Mar. 2014
Feb. 2015
Mar. 2015
Mar. 2015
Sep. 2016
Nov. 2016
Nov. 2017
Feb. 2018
Mar. 2018
May 2018
Sep. 2018
Nov. 2018
Jan. 2019Feb. 2019
May 2019
May 2019
Jun. 2019
Sep. 2019Feb. 2020Feb. 2020
Mar. 2020
Mar. 2020
Mar. 2020
Apr. 2020
Oct. 2020
Mar. 2021
May 2021

The Parkhabio Nakano Shinbashi

Nakano, Tokyo

66

The Parkhabio Shinsen

Meguro, Tokyo102

May 2021

The Parkhabio Minamiooi

Shinagawa, Tokyo109

May 2021
May 2021

The Parkhabio Meguro Residence

Shinagawa, Tokyo

66

The Parkhabio Hongo Kikuzaka

Bunkyo, Tokyo65

Jun 2021

The Parkhabio Koenji Residence

Suginami, Tokyo

140

Aug. 2021

The Parkhabio Azabujuban

Minato, Tokyo

106

Oct. 2021

The Parkhabio Shin-Koenji

Suginami, Tokyo

58

Oct. 2021

The Parkhabio Koishikawa

Bunkyo, Tokyo

56

Dec. 2021

In addition to the listed above, there are approximately 45 projects under development
MITSUBISHI ESTATE CO., LTD.

74

International Business

MITSUBISHI ESTATE CO., LTD.

75

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 Billion Yen.
Business Area
Mitsubishi Estate London Limited

China
Total Asset Approx. ¥48bn

TaiwanTotal Asset Approx. ¥13bn

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

LondonNew Jersey

The United Kingdom
Total Asset Approx. ¥257bn

Colorado
Shanghai

Mitsubishi Estate (Shanghai) Ltd.

Hanoi
Bangkok
Mitsubishi Estate Asia Pte. Ltd.

Mitsubishi Estate Taiwan Ltd.

Georgia

California
Arizona

New York
Washington DC & Maryland
Miami

TaipeiHo Chi Minh CityThe United States
Total Asset Approx. ¥554bn

JakartaSoutheast Asia and Oceania
Total Asset Approx. ¥260bn
SydneyTowards 2030 Target♦

Annual investment: Approx. ¥200–250 bn♦

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

2nd half of 2020s:
Balance investment and return

MITSUBISHI ESTATE CO., LTD.

2030 Target

FY2022
Asia 45%

Asia 28%

the U.S. 49%
Total Asset¥1.13tn

Europe 23%

Asia 30%
Business Profit¥55.8bn
Europe 2%
the U.S. 68%

the U.S. 35%

Total Asset
Approx. ¥the U.S. 40%

1.5tn

Europe 20%

Business Profit
Approx. ¥Asia 45%90.0bnEurope 15%76International Business

2. Regional Strategy／the U.S.
the U.S.
Strategies• Strengthen capital recycling business and capitalize on RGII* know-how• Promote joint ventures with local partners*Rockefeller Group International, Inc.
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

Investment Amount

Ending Balance*︓¥986bn29%*inventories+equity investment+fixed assets

14%

24%

the U.S. (Manhattan)
Europeequity investment
53%

33%

22/3
¥466bnfixed assets
47%

the U.S. (Others)
Asia

Breakdown of Investment Amount ※CAPEX＋Equity
9%10%

Hybrid Model Investment Buisness

Hybrid 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.

inventories
0%

Status of Overseas Assets (as of March 31, 2022)

12%

4% 1%

22/3
Results¥98.7bn

39%

25%

logistics
Hybrid Model Investment/Same Boat Investment
Rental Apartment
Data Center
Condominiums
OfficeOthersMajor Ongoing Project
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.

Property Name
Stateline 77
Hanover
55 Paradise
Virginia Data Center Building（Buiiding1・Buiiding2）
Liv Crossroads
Liv Laveen
200 East 83rd
1158 Delaware
1072 West Peachtree
600 Fifth Street NW

Location
US (South Carolina)
US (Pennsylvania)
US (New York）

Type
Logistics
Logistics
Logistics

Completion
Size※12022
93,600㎡
2022
42,200㎡
2023
16,700㎡

US (Virginia)

Data Center

2024・2025

51,000㎡

US (Arizona)
US (Arizona)
US (New York）
US (Colorado)
US (Georgia)
US (Washington, D.C)

Rental Apartment
Rental Apartment
Residence
Rental Apartment
Mixed Use
Office

2022
2023
2023
2024
2025
2025

356units
360units
86units
250units
49,300㎡
37,000㎡※1: Leasable Area (m2) or Units

77

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

Investment Amount
Status of Overseas Assets (as of March 31, 2022)
Ending Balance*︓¥986bn29%*inventories+equity investment+fixed assets

24%

the U.S. (Manhattan)
Europeequity investment 26%

14%

22/3
¥234bn33%

Breakdown of Investment Amount ※CAPEX＋Equity

Rental Apartment Development

19%

4%

22/3
Results¥53.7bn

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

fixed assets
74%

the U.S. (Others)
Asia

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

3

inventories
0%

OfficeRental Apartment

77%

Hybrid Model Investment/Same Boat Investment

Major Ongoing Project
Advantages• Know-how and network based on nearly 40 years of successful business experience– 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 13.3
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%

Property Name

Location

Warwick Court（Large Scale Renovation）
8 Bishopsgate

UK (London)
UK (London)

The Lark (Nine Elms Park)

UK (London)60-72 Upper Ground(ITV The London Television Centre)

UK (London)

Type
OfficeOfficeRentalApartment

Completion
2022
2022

Size※1
19,000㎡
53,000㎡

2022

195units

Mixed Use

Late 2020ʼs

TBD※1: Leasable Area (m2) or Units

Special Movie
Introductory Video of Major Projects in London
The following are some of the development projects that our group ispursuing in central London.
https://youtu.be/hcoBFNSOIHw

MITSUBISHI ESTATE CO., LTD.

78

International Business

4. Regional Strategy／Asia
Asia

Investment Amount

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

Large-scale mixed-use development projects in SE Asia & Oceania with our major share2

Status of Overseas Assets (as of March 31, 2022)
Ending Balance*︓¥986bn29%*inventories+equity investment+fixed assets

24%

the U.S. (Manhattan)
Europe14%

22/3

the U.S. (Others)
Asia

Breakdown of Investment Amount ※CAPEX＋Equity
13%

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

26%

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

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.

fixed assets
33%

equity investment ¥286bn
64%

33%

Development of condominiums– 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.

inventories
3%

Office1%

22/3
Results¥19.8bn

Condominiums

60%

Retaillogistics

Major Ongoing Project
Property Name

Location

Suzhou Business Park
Savya Financial Center North
Tower
Oasis Central Sudirman
180 George Street
Parkline PlaceOne City Centre

Jiangsu, Suzhou, China

Type
OfficeCompletion2024

Size※1
220,400㎡※2

Philippines (Manila)

Office2022

29,700㎡※2

Indonesia (Jakarta)
Australia (Sydney)
Australia (Sydney)
Thailand (Bangkok)

Mixed Use
OfficeOffice/Retail
Office

2028
2022
2024
2022

307,000㎡※2
55,000㎡
49,100㎡
61,000㎡※1: Leasable Area
※2: Total Floor Area

79

International Business5. Condominium Business in Asia
In Asia, the land bank has been built up and deliveries are strong in the for-salehousing market.
(At the end of FY2022)■Major Ongoing Project
Property NameLand Bank of For-Sale Condominiums in Asia
400

350

*Based on MEC's shares

250 50

1,100
5,000
1,400
1,450

Location

Total units

MEC's shareCompletion

Southeast Asia
RHYTHM Ekkamai Estate

Thailand (Bangkok)

303

49%

2022

Life Sathorn Sierra

Thailand (Bangkok)

1,971

49%

2022

Malaysia

RHYTHM Charoenkrung Pavillion

Thailand (Bangkok)

421

49%

2022

OthersThe Address Siam-Ratchathewi

Thailand (Bangkok)

880

49%

2023

Life Rama 4-Asoke

Thailand (Bangkok)

1,237

49%

2024

GEMS

Malaysia (Selangor)

676

45％

2023

Oasia(Previously:L34)

Vietnam (Dong Nai Province)

489

49%

2023

DAISAN

Indonasia (Kota Tngerang)

1,767

49%

2027

Kizuna Heights

Philippines (Manila)

1,036

40%

2026

Zhongnan・Southern Shore
MansionHuainan, 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

Australia (Sydney)

R1 : 315
R2 : 322

R1 : 25%
R2 : 25%

2024

ThailandChina

Indonesia

Australia

Philippines
Vietnam

Total: 10,000 units

East Asia

Oasia（previously L34）/Vietnam
Totals Units︓489
MEC's share︓49%
Life Rama 4-Asoke／Thailand
Completion︓2023
Totals Units︓1,237
MEC's share︓49%
Completion︓2024

MITSUBISHI ESTATE CO., LTD.

Oceania
One Sydney Harbour R1/R280

Investment Management Business

MITSUBISHI ESTATE CO., LTD.

81

Investment Management Business1. Investment Management Business︓Global Platform
Japan Real Estate Asset Management Co., Ltd.

EuropeUnited States
TA Realty

Europe Capital

Asia-Pacific
MEC Global
Partners Asia

CLSA Real Estate

Carry out marketing and 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.

Established in 2000. Entrusted with asset management of"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 Japan andoverseas based on the know-how and resources accumulatedby 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 adiverse range of real estate, including office, logistics,
residential and retail properties in major cities across the U.S.
Acquired in 2015 and became a subsidiary.

Europa Capital (Europe)
Established in 1995. Based in the U.K., manages funds thatinvest in office, residential, commercial and logistics properties
throughout Europe. Acquired a stake in the company in 2010,
making it a subsidiary.

MEC Global Partners Asia (Asia, Oceania)
Established in 2017 (name changed in 2021). Based in
Singapore, manages core-plus private funds that invest in panAsia.

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

MITSUBISHI ESTATE CO., LTD.

CLSA Real Estate (Asia, Oceania)
Managed pan-Asian value-add private funds since 2004;
acquired and became a subsidiary in 2019.

82

Investment Management Business2. Investment Management Business︓Increase in Assets under Management (AUM)
Stable increase in AuM
As of the end of FY2023-2Q, AuM expanded to a total of ¥5.5 trillion in Japan and abroad.
Achieved Long-Term Management Plan(targeting ¥5 tn by the mid-2020s) ahead of schedule.
At the time of the announcement of the Long-Term
Management Plan

As of end of Sep. 2022

(Announced Jan. 2020）

Domestic: As of end of Sep. 2022, Overseas: As of end of Jun. 2022
(Billions of yen)

Targeting ¥5 tn
by the mid-2020s

Asia & Oceania
200

Asia & Oceania
Europe500
Europe
JRE
Overseas
US

Total:¥Approx.
3.1 tn
MJIA

MITSUBISHI ESTATE CO., LTD.

Japan

Achieved Long-Term
Management Plan
ahead of schedule

JRE
1,100

Total:¥Approx.
Overseas

5.5 tn

Japan
MJIA
1,000

US
2,700

83

Investment Management Business3. Investment Management Business︓Changes in Operating Profit
Increased in profit from AUM expansion.
Significant profit increase in FY2022 due to incentive fee resulting from increased fairmarket value of U.S. funds.
(Billions of yen)【*Recognition of future fees associated with increased market
value of real estate in funds in the U.S. and other countries】

30
26.5

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

25• Such fees are received near the end of the fund as returns are determined, but inaccounting, the company updates returns as needed using market valuations ofreal estate and records the fees it expects to earn as operating revenue eachperiod (no cash inflows at this time).

20

Approx. 18.5

15

13.0

FY2021

FY2022

FY2023(F)¥ 3.6 tn

¥ 3.7 tn

¥ 4.5 tn-

MITSUBISHI ESTATE CO., LTD.

ExcessExpected returns

FY2020Returns calculatedusing market valuations

4.4

5.9

0

End ofFY
AUM*This is a general description and may differ
from the design of our funds.

【Accounting procedures】

10
5• Although it will contribute fully to operating revenue and operating profit, its
contribution to profit attributable to owners of parent will be limited (no cash
outflow at this time) because a portion will be posted as profit attributable to noncontrolling interests in the form of compensation to the officers and employees of
the asset management company.

Excess dividends toinvestors

Revenues received byasset managementcompany
Dividends to investors
Recorded in operating revenue as
future fees associated withincreased market valuation

84

Investment Management Business4. 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.

85

Investment/Financial Data, etc.

MITSUBISHI ESTATE CO., LTD.

86

Investment/Financial Data, etc.

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

2,700

9

2,400
6.7

2,100

8

7.1
6.6

6.6
6.6

1,800
6.1

6.2

6.1

6.8

6.4

1,500

7
6
5

2,504

2,354

1,200
2,140
1,965

900
600

2,042
2,217

2,680
2,347

2,523

2,196

3

1.31

1.40

1.36

1.37

1.33

1.10

1.18

1.18

1.19

1.17

FY2019FY2020

FY2021

FY2022

FY2023(F)

300

4

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.

87

Investment/Financial Data, etc.

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

4,000

96.1%

93.7%

96.4%

95.1%

93.4%

95.4%

93.6%

93.2%

92.4%
83.2%

3,000

69.7%
64.1%
60.1%

2,000

6.8

54.0%

53.1%

7.2

9.5

10.2

100.0
100.0

1.9
100.0

50.0
2.0
100.0

1.7
0.0
100.0

1,428.5

1,760.5

1,523.0

1,406.0

1,450.7

1,563.2

1,208.8

1,000

25%
250.0

250.0

250.0

250.0

250.0

215.0

215.0

747.2

701.5

685.2

653.0

612.7

603.8

558.9

577.1

595.7

661.3

FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

2,085.4

1,973.0

1,929.3

2,291.0

2,396.9

2,481.6

2,319.5

2,429.8

2,526.1

2,738.6

0

Total

75%

50%

1,381.2
1,261.9

5.6

86.5%

28.0

35.0
1,292.9

100.0

50.0
4.5

4.7

100%

76.4%

76.2%

73.2%

93.3%

0%

Straight bond

MITSUBISHI ESTATE CO., LTD.

Subordinated bondBank Loan

Subordinated loan

CP

Lease liability

Fixed ratio

Long-term ratio

88

Investment/Financial Data, etc.

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

12

2.0%

1.88%
1.72%

8.16
8

1.40%

1.54%

1.55%

1.52%

1.27%
5.45

5.55

1.01%
4

5.58

5.45

1.05%

1.07%

5.71

1.41%
6.18

1.38%

6.79

6.36

0.96%

0.95%

6.69
1.24%

0.97%

0.87%

1.14%

0.75%

0.70%
0.62%

0.61%

FY2015FY2016

0.66%

1.09%
0.96%

0.92%
0.84%

0.72%

1.5%

7.23

1.32%
0.96%

8.20

0.71%

0.68%

0.78%

1.0%

0.74%

0.63%

0.60%

FY2021

FY20220.5%

0FY2011FY2012FY2013

FY2014

Average duration of interest-bearing debt

MITSUBISHI ESTATE CO., LTD.

FY2017

Bonds/Average interest

FY2018FY2019FY2020Bank loans/Average interest

Total/Average interest

89

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/e/investor/plan/pdf/plan200124_e.pdf
MITSUBISHI ESTATE CO., LTD.

90

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.

91

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.

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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％93

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

94

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)

95

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

96Appendix.

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/e/investor/plan/pdf/plan200124_e.pdf
MITSUBISHI ESTATE CO., LTD.

97

Macro Index

1．Historical Consumer Price Index（YoY, ％）

Consumer Price Index in different countries (composite) *

12%

10%

9.9%

8%

8.3%

6%

4%

3.0%
2.5%

2%

0%

-2%

19/1

19/4

19/7

19/10

20/1

20/4

20/7

United States

MITSUBISHI ESTATE CO., LTD.

20/10
China

21/1

21/4
Europe

21/7

21/10

22/1

22/4

22/7
22/8

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 Communications98

Macro Index

2．Historical domestic interest rate(%）

Interest rate (monthly)

1.0%

0.8%

0.6%

0.4%

0.2%

0.0%

-0.2%

-0.4%

12/7

13/1

13/7

14/1

14/7

15/1

15/7

16/1

16/7

17/1

17/7

18/1

JGB yield of newly issued 10-year government bonds

18/7

19/1

19/7

20/1

20/7

21/1

21/7

22/1

22/7
22/9

Unsecured overnight call rate
Source: Bank of Japan, Japan Bond Trading Co.,Ltd.

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Macro Index

3．Historical foreign exchange rate
(Yen/Dollar)

Dollar-yen exchange rate

150

140

130

120

110

100

90

80

70
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Source: Bank of Japan "Financial and Economic Statistics Monthly"
MITSUBISHI ESTATE CO., LTD.

100

Macro Index

4．Historical expected cap rate by types of property(%）
As of April 1st of each year

Expected Cap Rate by Type of Property in the Tokyo Area

7.0%
6.5%
6.0%
5.5%

5.3%

5.0%
4.6%

4.5%

4.0%
4.0%

4.0%
3.5%

3.3%

3.0%

13/4

14/4

15/4

16/4

17/4

18/4

19/4

20/4

21/4

22/4

A-Grade office buildings* in the Marunouchi and Otemachi areas
Residential properties for standard studios in southern Tokyo
Multiple-tenant-type warehouse properties in Tokyo (Koto District)
Economy hotels for lodging in Tokyo
Shopping centers on the outskirts of Tokyo* Covers properties within five minutes' walk from the nearest
station and with floor areas of at least 50,000 ㎡
Source: Japan Real Estate Institute

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

MITSUBISHI ESTATE CO., LTD.