Sustainability Report 2021
Activia Properties Inc.

June 2021

IndexIntroduction
・Top Messages

3・About API

5

Sustainability Policy / Structure for Promotion
・Sustainability Policy

7・Our Structure to Promote Sustainability

7・Materiality

8・Topics

11・External Certifications / International Initiatives

13

Governance・Our View on Governance

15

・Corporate Governance Structure to Maximize Our Unitholder Value

15・API’s Corporate Governance

17

・TRM’s Corporate Governance

19

Environment
・Our View on Environment

23

・Environmental Considerations

23

・Environmental Performance

25

・Green Certifications

26

・Green Procurement Standard / Green Lease Agreement

27

・Environment Management System

27

・Green Bonds

28

Social・Our View on Society

31

・Employee Engagement

31

・Contribution to the Local Communities

38

・Tenant Engagement

39

・Supplier Engagement

40・Independent Assurance Statement41

1Basic Policies of API

About this Report
Activia Properties Inc. (“API”) and TLC REIT Management Inc. (“TRM”) to which API entrusts
its asset management, are making the best effort to disclose information related to thesustainability initiatives to the investors and other stakeholders. Within this scope, this report isissued to illustrate the ESG (E: Environment, S: Social, G: Governance) initiatives at API and TRM
which are essential to contribute to a sustainable society.
Coverage on this report
PeriodEntities

From April 2020 to March 2021 (excl. some data)
API and TRM

Contact
Dept.

Phone

Activia Management Division, TLC REIT Management Inc.
Shibuya Solasta 18th floor, 21-1 dougen-zaka 1chome,
Shibuya-ku, Tokyo, Japan+81-3-6455-3377

Hours

9:30-18:00 (excl. Saturday, Sunday and holidays)

Address

We communicate also using the Global Reporting Initiative (GRI) Sustainability ReportingStandards, an international sustainability framework for ESG-related reporting. About the GRI
Standards, please see the link below:
https://www.activia-reit.co.jp/en/sustainability/gri.html

2

Introduction
Top Messages
From Executive Director of API
Activia Properties Inc. (“API”) is pleased to issue its inaugural sustainability report to announce
our sustainability initiatives in a clear and handy manner.
API aims to enhance the value of unitholders through investing and managing portfolio comprisedof offices and retail properties in urban areas with a focus on prime location and high quality. Our
properties take a social responsibility as they serve as a key to the active communities and a hub
for the economy, therefore we consider that contribution to the areas surrounding the properties
and the local communities is one of our important missions.
In line with the policy above stated, since IPO, we have continuously worked to enhance multiple
sustainable efforts including development of relationship with communities, reduction in usage ofenergy and resources from viewpoint of mitigating ecological impact, and issuance of green bonds
from financial viewpoint.
Since 2013, we are participant to the GRESB Assessment, an ESG benchmark in the real estate
sector, and are using the results to continuously improve the effectiveness of our initiatives.
In recent years, companies are required to take more developed initiatives towards challenges
related to environment and local societies and integrate them into key management issues. In
response to such social trend, in July 2019, API identified its own Materiality and set a practicalmanagement policy.
API will further develop its efforts on sustainability, deepening a trustworthy relationship with thestakeholders while investing in and managing real estate capable of sustaining customer demandand gathering people, seeking to become an entity capable of broadly energizing society as thename “Activia” suggests. This report highlights our continued efforts. We sincerely wish that thereaders would feel sympathy to our sustainability initiatives and hope that we can work together tocreate a better society.

Activia Properties Inc.

Executive Director Kazushi Sato3

From President & CEO of TRM
TLC REIT Management Inc. (“TRM”) is an asset management company aiming to maximize its
shareholder value with a philosophy that we should contribute to the development of our society
through a reliable relationship with all the stakeholders.
In recent years, issues related to climate change, working style reform and relation with local
communities are recognized as problems close to ourselves and unpreparedness for thosechallenges are becoming risks in investment for shareholders and investors. And in the same time,
how to approach to those challenges is being a part of the opportunity to create a new value andnew businesses. We believe that incorporating such social demand for ESG (Environment/Social/
Governance) into our business operation and working for a sustainable society take an essential
part to improve our corporate value.
To enhance our efforts and implement those in a more practical way, we established theSustainability Policy in April 2019. Further in July 2019, we recognized the Materiality of the Tokyu
Fudosan Holdings Group (“TFHD” or the “Group”) and extracted from it the items which are criticalfor us in the medium to long term to identify our own materiality, and it is shared with API.
In April 2021, we organized formally the Sustainability Promotion Council and established theSustainability Department under the Corporate Management Division to put the Sustainability Policy
into more practical measures and to further sophisticate those measures.
Together with API, we will continue to work proactively for the objectives set based on therespective Materiality, as well as appropriately disclose our progress to all stakeholders while
deepening trustworthy relationship with them.

TLC REIT Management Inc.

President & CEO Hiroyuki Tohmata

4About API
Overview
API is a diversified J-REIT investing in commercial properties and offices sponsored by Tokyu Land
Corporation (“TLC” or the “Sponsor”).
API intends to maintain a competitive portfolio in the medium to long term with the objective tomaximize its unitholder value, by investing primarily in urban retail properties and Tokyo officeproperties with making these investments upon careful consideration of location, size, quality,
specifications, and suitability for use by tenants.

TRM, to which API entrusts its asset management is one of the member companies of TFHD, acomprehensive real estate developer. We are taking advantage of the TFHD’s multi-faceted andcomprehensive knowhow and value chain to consistently acquire high-quality properties, as wellas to operate and manage the properties so that the value of the properties would be maintained
and improved. By doing so, we plan to maximize the unitholder value.
While leveraging the value chain of TFHD, we also try to ensure and enhance various systems
supporting our strong governance structure in order to maximize our unitholder value. The
measures include preventive system against conflict of interests in related-party transactions,alignment of interests between investors and the Sponsor, as well as amendment to the asset
management fee structure including DPU-linked portion (Cf. page 15).
＜TFHD’s value-chain>

5

History, etc.
Since our IPO in 2012, API has continued to work to build a high-quality portfolio which is carefully
selected with a focus on location and property quality and grow and stabilize earnings by expanding
assets under management. With a portfolio having grown to over 500 billion yen, API became oneof the major diversified J-REITs.
＜History of API>
Sep. 7, 2011

Registration of incorporation, and foundation under Article 166 of theof API> Corporations
Act on Investment＜History
Trusts and Investment

Sep. 20, 2011

Implementation of registration by the Prime Minister under Article
189 of the Act on Investment Trusts and Investment Corporations(registration no.: Director of Kanto Local Finance Bureau No.73)

Jun. 13, 2012

Listed on the J-REIT section of the Tokyo Stock Exchange(securities code: 3279)＜Trend in number of properties and assets under management of API>＜Overview of API and TRM>REIT (API)Name

Asset Manager (TRM)
Activia Properties Inc.

Name

Executive director Kazushi Sato

TLC REIT Management Inc.

President & CEO Hiroyuki Tohmata

Address

Shibuya Solasta 18th floor, 21-1 dozen-zaka 1chome,
Shibuya-ku, Tokyo, 150-0043, Japan

Address

Shibuya Solasta 18th floor, 21-1 dozen-zaka 1chome,
Shibuya-ku, Tokyo, 150-0043, Japan

Contact

Activia Management Division, TLC REIT Management Inc.
Phone: +81-3-6455-3377

Capital

200 million yen

Securities code

3279

Date of listing

June 13, 2012

Shareholder

Tokyu Land Corporation (100%)

Business segment Investment management

Fiscal period end May 31 and November 30

Fiscal year end

6

March 31

Sustainability Policy / Structure for Promotion
Sustainability Policy
TRM considers paying consideration to environment and society and strong governance as its
mission, and as a member of TFHD, it shares the Group’s sustainability vision. We believe thattackling these issues is a social responsibility and it should help to realize our management
philosophy and contributes to the development of a more sustainable society. The Sustainability
Policy has been set to put our beliefs into practice.
For the details of the Sustainability Policy, please refer to TRM’s website.
https://www.tokyu-trm.co.jp/en/sustainability/

Our Structure to Promote Sustainability
To enhance TRM’s efforts towards the issues related to environmental or societal consideration,etc. based on its Sustainability Policy, the rules on the Sustainability Promotion System require that
the President & CEO to be the Chief Sustainability Officer and each department appoint one
responsible person from the department. The Sustainability Promotion Council is to be held with
the President & CEO as chairperson.
Sustainability Department was established as of April 1, 2021 to expand the functionality of the
Sustainability Promotion System. The Sustainability Department succeeds the ESG-related missions
from the Environmental Engineering Department, and we will further promote our sustainability
program.
Sustainability Promotion Council
The Sustainability Promotion Council meets regularly with President & CEO as the Chief
Sustainability Officer who assumes the ultimate responsibility, and other members from across theorganization of TRM and among members, we share relevant information and examine and promote
the efforts. External experts are invited to the Council to consult opinions when needed.

Members of the
Sustainability
Promotion Council

Chairperson: President & CEO
Regular members: Chief Division Officers of the Activia Management Division,
Comforia Management Division, and Broadia Management Division, Corporate
Management Division, General Managers of Environmental Engineering Department,
and Sustainability Department, Compliance Officer
Organizer: Sustainability Department

Meeting frequency

Every quarter in principle

Main issues to be
discussed

・Amendment and abolishment of the Sustainability Policy
・Amendment and abolishment of the Materiality
・Matters related to, and common to TRM and investment corporations
・Annual activities planning, report on status

7

Materiality
Identification process
In line with the Policy and as a member of the Group, TRM recognizes the materiality issues of
the Group and identified its own materiality issues by extracting societal items which are important
over the medium to long term for a sustainable society, with consideration to the environmental
efforts API has already made. This Materiality is shared between TRM and API.

SDGs strongly linked to our Materiality
The Materiality that API shares with TRM reflects the magnitude of impact our actions will haveon the relevant risks and opportunities.
Our aim is to contribute to the Sustainable Development Goals (SDGs) through our approaches
to Materiality. For the details of SDGs, please refer to the following website of the Ministry of Foreign
Affairs: https://www.mofa.go.jp/policy/oda/sdgs/index.html
Materiality

Reducing environmental
ImpactRisks(Impact of not addressing materiality)

Increased physical risk from escalation of climate change(human damage, property damage, economic damage)Opportunities(Business opportunities expected by addressing materiality)
・Sharing and executing clear commitment to ESG investment with
officers and employees should provide opportunities to implement
such actions into our business strategy
・Increased demand for leasing properties focused on environmental
performance
Each employee's effort to further realize an ability and maintainmental health and stable living while fulfilling the fiduciary duty

Human capital development Lack of sufficient skilled human resources may hinder business
required of asset management business and working towards ouras a group of professionals operation, leading to stagnant or lower investor values

goal of maximizing unitholder value and enhancing our presence will
create a positive cycle and improve our performanceContribution to local
communities

・Breakdown of communication with local community at theShow presence by contributing to the safety and security of thetimes of emergency such as disaster may cause reputation risk
region and vitalization of local economy as a member of a corporate・Risk of loss of liveliness due to the image of the invested
group committed to urband development
region becoming obsolete or due to population decrease

Health and well-being of
tenants

Facilities with inferior ESG considerations may have risk oflosing support from tenants

Supplier engagement

Impact on management operation and deteriodated credit in
Cooperate with suppliers to satisfy fiduciary duty required of asset
case of significant violation against sustainable procurement
management business and contribute to becoming the REIT of choicesuch as discrimination, exploitation, destruction of nature,by the investors
contamination and violation of laws by suppliers are recognizedManagement framework
Inappropriate response to multifaceted social demands may
corresponding torisk fail in trust concerning sound and effective management
multifaceted social demandbusiness and affect market development
towards sustainable society

Contract renewal and repeated selection for relocation by tenants
can be expected by creating safe, comfortable and pleasant space fortenants

Enhanced commitment to environment and society will further
promote establishment of the medium- to long-term businessplatform, and improvement in financial value can be expected8

Relevant SDGs

API’s Initiatives
Materiality(Environment)

Reducing environmental
impactPolicyStatus / Examples

・Proactive introduction of environmentally friendly facilities andtechnologies
・Energy use: Medium- to long-term target of 1% average annual
・Periodic measurement of environmental performance of the
reduction in energy use intensity
portfolio
・Energy-related CO2 emissions: Medium- to long-term target of・Periodic measurement of environmental performance of each
1% annual average reduction in greenhouse gas emissions
property
intensity
・Constant acquisition of environmental certification , etc.
・Water conservation: Medium- to long-term target of 0.5%
・Promotion of tenant engagement through green leases, etc.
average annual reduction in water use intensity
・Periodic and continuous monitoring by Sustainability Promotion
・Waste generation: Medium- to long-term target of 0.5%
Councilaverage annual reduction in waste intensity
・Promotion of environment-friendly procurement through “Green
Procurement Standards”
7.3 By 2030, double the global rate of improvement in energy efficiency

Relevant SDG targets

12.5 By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse
12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature

Materiality(Social)

PolicyStatus / Examples

・Promote human resource strategy that indicates the

Human capitalrequirements of desirable resources and facilitate development
development as a group ・Commitment to health and well-being of each employee
・Deployment of measures based on TFHD's KPIs (work-styleof professionals
reform, promotion of diversity)

Contribution to local
communities

・Enhance disaster prevention functions
・Prompt recovery of assets under management following
occurrence of a disaster・Educational activities on fire and disaster prevention anddisaster response
・Enhanced cooperation with local community

Health and well-being of・Improve tenant satisfaction
tenants

Supplier Engagement

・Disclosure of key employee data to present our human resources
strategy and status of efforts on employee health and well-being(ratio of female employees, number of female directors andmanagers, turnover ratio, stress check participation ratio, etc.)
・Support acquisition of business knowledge, skills, qualifications,and implement various trainings
・Promote career development through periodic performance
evaluation/feedback
・Periodic Health Committee
・Introduction of various support systems leveraging on Tokyu
Group membership, etc.
・Publication of capital expenditure/emergency reserves fromdisaster prevention perspective
・Improvement of seismic performance, Installation of emergency
generator, and establishment of BCP・Cooperation for disaster prevention, disaster response andinfectious disease prevention
・Sponsorship/participation/cooperation with local events
・Extract issues and make improvements based on tenantsatisfaction survey

・Aim at smooth property management by utilizing expert knowhow of Tokyu Land Corporation, Tokyu Community, Tokyu LandSC Management, and the support agreement counterparty
Tokyu Fudosan Holdings Group companies
・Share information and actively work on environmentallyfriendly procurement with PM/BM companies

・Build/promote collaborative structure through periodic monitoring
・Conduct training on environment, etc.
・Promote collaboration with all stakeholders through “Green
Procurement Standards”

11.3 By 2030, enhance inclusive and sustainable urbanization and capacity for participatory, integrated and sustainablehuman settlement planning and management in all countries

Relevant SDG targets

12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature

Materiality(Governance)
Management framework
corresponding tomultifaceted social
demand towards
sustainable society

PolicyStatus / Examples

・Explicitly describe statement on governance of the investment
・Governance of the investment corporation
corporation
・Investment decision making body and the risk management
・Explicitly describe the investment decision making body, as wellsystem for investment management
as the risk management system for investment management
・Establishment of Sustainability Promotion Council for the Asset・Establish framework for promoting implementation of theManager
Sustainability Policy

12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development
and lifestyles in harmony with nature

Relevant SDG targets
16.7 Ensure responsive, inclusive, participatory and representative decision-making at all levels

9Relevance of the Materiality of API&TRM to that of TFHD

10

TFHD’s Code of Conduct, etc. that TRM shares as a member of the GroupAs a member of TFHD, TRM does not only leverage the Group’s comprehensive value-chain andexpertise, but also shares the Code of Conduct and other policies of the Group.
1.

Tokyu Fudosan Holdings Group’s Code of Conduct (Cf. page 20)

2.

Sustainable Procurement Policy (Cf. page 27)

3.

Human Rights Policy（Cf. page 36）

4.

Labor Standards and UN Global Compact (UNGC) Signatory (Cf. page 36)

TopicsResponses to COVID-19
・Measures taken to prevent expansion of the pandemic (API)In response to the government request, API closed SC-type retail properties where many
unidentified individuals are expected to visit and took measures to prevent viral spread in all of its
owned properties. Even after the emergency was shifted, we kept on taking various preventive
measures including alcohol-based hand sanitizer installation, disinfection of high touch areas suchas handrails in buildings, anti-virus coating in common areas and ventilation inside facility.
＜Properties that completely suspended the operation and periods of facility closure (2020)>＜Preventive measures against COVID-19 taken in facilities>

11・Rent reduction to tenants (API)In addition to rent reduction provided to the tenants obliged to close their businesses during theclosure of the facilities they are located in, API also responded to the relief requests from tenants
affected by the pandemic and granted measures tailored to each tenant such as temporary rent
reduction. We consider that those responses may have served to strengthen relationship with tenants.
＜Response to commercial tenants (as of Nov. 30, 2020)>

Amendment to asset management fee structure (API)The fifth unitholders’ meeting of API held in August 2019 approved the amendment to the asset
management fee structure aiming to improve the unitholder value. Total asset-based fee (Type I)
was lowered while DPU and NOI-based fee (Type II) was increased with objective to strengthen
incentive towards maximization of unitholder value.
<Amendment to AM fee structure>

Additional ownership acquisition by Sponsor
TLC announced additional acquisition of units of API in May 2020 and completed the procedure in
July. Amid a tough downward momentum of the unit price due to COVID-19, the Sponsor showedanew its supportive position to API, marking a strengthened alignment of interest between theSponsor and our unitholders.
＜Number of shares held by Sponsor>

12

Donation to Hokkaido pref. through regional revitalization support tax system (TRM)
Through the regional revitalization support tax system, TRM made a donation to a fundraisingprogram in order to support medical staff in Hokkaido pref. where API owns a property. This
donation is a part of efforts to “contribution to local communities”, one of the Materiality that API
shares with TRM.

(Source) Website of Hokkaido pref.

External Certifications / International Initiatives
External certifications
・GRESBAPI was awarded the highest rank “5 stars” for third consecutive years on GRESB Real Estate
Assessment, an overall evaluation of ESG consideration performance. API also received arecognition of high performance in “Management Component” and “Performance Component”, aswell as “Green Star” for seven consecutive years for its advanced framework and practices. Further,it achieved “A rank” in the GRESB Public Disclosure for three consecutive years.
TRM is a GRESB participant member since 2019 to be a part of worldwide sustainability initiatives.

・Others
API was rated “Low Risk” on the Sustainalytics ESG risk assessment in September 2020 andearned “BB” rating on the MSCI ESG Ratings held in May 2020.

13

International initiative
・UNGC
TFHD has been a signatory to the United Nations Global Compact since December 2016 and TRM
supports the UNGC’s 10 principles as a member of the Group.
For the UNGC 10 principles, please refer to the link below.
https://www.unglobalcompact.org/

TRM shares the Human Rights Policy of TFHD announced in January 2020 (Cf. page 36) andconducts business in belief that the respect for the human rights of all its stakeholders is essential.
We also believe that all the companies should hold such respect.

14

Governance
Our View on Governance
Under a belief that it is essential for our operation to implement a sincere and fairly compliancemanagement, API and TRM thrive to build an effective decision-making process and a strong
corporate governance structure to prevent negative occasions, such as conflict of interests cases thatwould damage the benefits of all our stakeholders including unitholders. This is derived from arecognition that we are conducting an important and responsible operation of managing assets which
belong to the unitholders.
Taking our societal responsibility and public missions into consideration, we will continue to makebest effort to meet expectations and reliance from our stakeholders including unitholders, customers,
business partners, and our local communities by contributing economical and societal development
through a healthy business operation.
Materiality(Governance)

PolicyStatus / Examples

Management framework
corresponding tomultifaceted social
demand towards
sustainable society

・Explicitly describe statement on governance of the investment
corporation
・Explicitely describe the investment decision making body, as wellas the risk management system for investment management
・Establish framework for promoting implementation of the
Sustainability Policy

・Governance of the investment corporation
・Investment decision making body and the risk management system
for investment management
・Establishment of Sustainability Promotion Council for the AssetManager

12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development
and lifestyles in harmony with nature

Relevant SDG targets
16.7 Ensure responsive, inclusive, participatory and representative decision-making at all levels

Corporate Governance Structure to Maximize Our Unitholder Value
While leveraging the value-chain of TFHD, API and TRM are working to improve and enhance thegovernance system contributing to maximize unitholder value, including approaches such asmeasures against conflict of interests with related parties, alignment of interests of unitholders andthe Sponsor, and amendment to the AM fee structure with DPU-linked fee.
Alignment of interests of API’s unitholder and TLC
・Ownership by the Sponsor
In the Sponsor Support Agreement, TLC has made it clear that if and when API decides to issue
additional units, a subscription of a part of such issuance shall be sincerely considered.
TLC acquired API’s additional ownership in July 2020 (Cf. page 12) and further support from theSponsor is expected with reinforced alignment of interests.

15

・Co-ownership of properties with the Sponsor
API holds co-ownership of interests with the Sponsor in the five commercial properties namely
Tokyu Plaza Omotesando Harajuku, DECKS Tokyo Beach, Q plaza HARAJUKU, Tokyu Plaza Ginza(Land) and Tokyu Plaza Akasaka. We consider that this alignment of interests between the Sponsor
and API’s unitholders, deriving from operating revenues of the owned assets including above,should lead to a better property management practice.
<Properties co-owned with Sponsor>

Acquisition process securing fairness to protect unitholder value
To realize an effective and transparent management, TRM has an effective decision-making
process based on internal regulations including the management guideline and rules on relatedparty transaction.
For instance, asset acquisition from related parties requires deliberation and resolution ofCompliance Committee, which includes external experts and an approval by the Board of Directorsof API. At board meeting of API, more stringent rules are applied and conducted.
<Acquisition approval process>16

Asset management fee structure including DPU-linked fee
Pursuant to the asset management agreement, API pays an asset management fee including
DPU-based portion to TRM. This structure is designed to incentivize TRM to enhance API’s unitholder
value.
Ratio of performance-based fee (type II) was increased from the fiscal period ended May 2020,
which would contribute to strengthen incentive to maximization of unitholder value (Cf. page 12).
<AM fee structure of API>

API’s Corporate GovernancePursuant to the Act on Investment Trusts and Investment Corporations (“ITA”), API entrusts its
asset management operations to TRM.
API’s governance structure
API’s organization comprises a unitholders’ meeting, a board of directors currently comprised of
one executive director and two supervisory directors, and an independent auditor. API has noemployees as ITA prohibits REITs to make employment contracts.
＜API’s governance structure＞

Unitholders’ meeting
Matters and issues on API, that are originally stipulated at ITA and other relevant laws &regulations, are to be resolved at a unitholders’ meeting.

17

Executive director and supervisory directors
The executive director represents API and is responsible for the administration of affaires of API.
The supervisory directors have a statutory duty to review the executive director’s administrationof API.
➤Term of office / brief biographies of directors
The term of office for directors is two years. Please refer to API’s website for the brief
biographies of directors.
https://www.activia-reit.co.jp/en/about/management.html➤Eligibility requirements
Candidate for directors must not fall under any disqualification clause as defined in the ITA.
Such candidates shall be examined and appointed at a unitholders’ meeting.
➤Compensation
The articles of incorporation of API stipulate that it may pay the executive director up to¥700,000 per month and each of our supervisory directors up to ¥500,000 per month, and theboard of directors of API is responsible for determining the amount for each director.
<Compensation of directors>
Excerpt from the semi-annual report for the fiscal period ended November 2020
Position
Executive
director

Name

Concurrent positions

Kazushi SatoManaging Director, Chief Division
Officer of Activia Management
Division, TLC REIT Management Inc.

Yonosuke Yamada

Managing Partner of Yamada, Goyaand Suzuki law offices

Supervisory
directors

Compensation received(\ thousand / fiscal period)-

3,300
Yoshinori Ariga

Ariga Yoshinori Accounting Office

Board of Directors
At the meeting of the board of directors, the executive director reports on the performance ofits duties and the supervisory directors supervise to ensure that API operates the asset management
in compliance with legal and regulatory requirements. The meeting frequency of the board should
be at least once in three months as stipulated under internal regulations of TRM. However, it is held
every month with a 100% attendance of directors in FY2020.
Independent auditors
The independent auditor shall audit the financial statements of API and report to the supervisory
directors any improper activity of the executive director. The term of office of the independent auditor
comes to an end at the first unitholders’ meeting held after the first financial period closed after one
year or more from the appointment date. The auditor shall be reappointed except as otherwise
resolved in a unitholders’ meeting.

18

<Auditor fee>
Excerpt from the semi-annual report for the fiscal period ended November 2020
Compensation(\ thousand / period)

Position

Name

Independent
auditorErnst & Young ShinNihon LLC

13,700(Note) Includes the comfort letter fee for the bond issuance in October 2020.

TRM’s Corporate Governance
TRM works to enhance corporate governance to exercise a fiduciary duty and a duty of loyalty to
API as stipulated in the asset management agreement.
TRM management organization
Under the management organization shown below, TRM exercises its asset management
operation, and the Activia Management Division undertakes the management of assets of API. TRM
has established the Investment Committee and the Compliance Committee to deliberate mattersrelated to asset management and compliance, and the Acquisition Priority Review Meeting todetermine the order of priority for consideration.
In April 2021, TRM established the rules on the Sustainability Promotion System to strengthen
the system and expand the functionality of measures. Following this, the Sustainability Promotion
Council obtained a more accurate position in the organization. The Sustainability Department
succeeds the ESG-related missions from the Environmental Engineering Department, and we willfurther promote our sustainability program.
＜TRM management organization＞

19

Compliance・Compliance Policy
Compliance is ensured in the business operation of TRM with the Compliance Committee and theCompliance Department established with objective to carry out our business in compliance pursuant
to the TFHD’s Code of Conduct. The framework is reinforced by the Rules on the Compliance andthe Compliance Manual.

・Compliance Committee
To perform a compliance reinforced management, TRM holds the Compliance Committee
comprised of members including one or more external experts (licensed expert such as attorney)
on a regular basis. The committee shall resolve the following matters.

・Measures taken to enhance compliance awareness➤Divisional Compliance Staff
Each year divisional compliance staff are appointed from each division to perform periodic
monitoring on compliance matters. The officers report compliance status in his/her division andshare related information.

20

➤Corporate ethics / compliance training
In order to ensure compliance and increase awareness of officers and employees to compliance,
we provide compliance training two times each year to all of them focusing on the enforcement of
the compliance basic policy and standards, and learning applicable laws and regulations, etc. An
orientation and follow-up courses (for employees new to the financial instruments business, after
six months have passed since hiring) are held as well.
・Measures to prevent corruption, bribery and malpracticeIn the belief that corruption creates significant obstacles against sustainable development andcorrodes the social structure, TRM recognizes that commitment to prevention of corruption is an
important issue for the society and is making the best effort to prevent any unfair practice in theoperation. The rules of employment and rules on the compliance stipulate that we shall not conduct
those acts, and periodical trainings are implemented to the employees. The effort includes also thatcompliance verification by supervisors while keeping evidence to make a judgment of complianceis required at a business transaction. Harsh punishment shall be imposed to on the employee who
conducted those acts.
TFHD is a signatory to the United Nations Global Compact (UNGC), and as a member of theGroup, TRM supports the ten principles of UNGC.
Please refer to TFHD’s website for details.
https://tokyu-fudosan-hd-csr.disclosure.site/en/themes/36
・Whistleblower system
TRM established the Compliance Helpline Counter as a contact point to report and consult oncompliance matters including when harassment and bullying is experienced or observed, enabling
all officers and employees to directly report to the Compliance Officer of TRM, General Manager ofLegal Affairs Department of TLC, General Manager of Group Legal Affairs Department of TFHD, or
external attorneys. Also, a system is already in place to structurally protect the whistleblowers
when such reports were conducted.

21

Risk Management
・Basic Policy on Risk Management
TRM established a basic policy on the strategic targets, as well as risk management rules toimplement appropriate management of risks.

・Risk management framework
TRM conducts sophistication of its risk management framework with a certain support fromexternal experts. Risk management function falls under the responsibility of the ComplianceDepartment supervised by the Compliance Officer. The Compliance Department is a stand-alone
department, independent from business operating divisions. It performs a series of risk assessment
including operational risk, etc.
・Risk management training
TRM provides periodical risk management educational session with all officers and employees byexternal lecturers and works to improve risk management ability of each department’s members.
・Information security
In order to enhance security of information assets and appropriate use of them, TRM has set
forth basic rules on information security management which stipulates principle matters related to
information protection with clarifying the responsibility for information management. TRM has alsoestablished the rules on IT management to stipulate appropriate management of information asset
by each officer and employee according to the level of their roles and responsibilities.
・Business continuity planning
To strengthen its resilience, TRM set a business continuity plan, related rules and manuals, andmake updates when necessary, in preparation for unexpected crisis such as disaster and social
disruption. In accordance with these rules, we work to prevent and mitigate impact from crisis
including recent natural disasters and COVID-19. We also pay close attention to the materials andequipment used in the properties of API and make every effort to prevent incident by staying wellinformed of defect products and carrying out research.

22

Environment
Our View on Environment
API considers climate change as a significant risk and identified reducing environmental impact
as part of its Materiality. We set a medium- to long-term target of 1.0% average annual reduction inenergy use intensity and energy-related CO₂ emissions, and a medium- to long-term target of 0.5%
annual average reduction in water use intensity and waste intensity. We believe that effort to reduce
environmental impact to mitigate climate-change related risk such as abnormal climatic conditions
and sea-level rise would lead to maximization of our unitholder value. Therefore, we continue tofulfill our mission to reduce environmental impact and provide high energy-saving performance inthe owned properties.
API and TRM consider that contribution to the local communities as well as urban revitalization,with environmental consideration, through management of our properties is one of our importantmissions. With regard to investment in undeveloped site (greenfield), we recognize that act ofdevelopment will have an impact on the natural environment and ecosystem, and we will continue
to make investment in light of such recognition.
Materiality(Environment)

Reducing environmental
impactPolicyStatus / Examples

・Proactive introduction of environmentally friendly facilities andtechnologies
・Energy use: Medium- to long-term target of 1% average annual
・Periodic measurement of environmental performance of the portfolio
reduction in energy use intensity
・Periodic measurement of environmental performance of each・Energy-related CO2 emissions: Medium- to long-term target of 1%
property
annual average reduction in greenhouse gas emissions intensity
・Constant acquisition of environmental certification , etc.
・Water conservation: Medium- to long-term target of 0.5% average
・Promotion of tenant engagement through green leases, etc.
annual reduction in water use intensity
・Periodic and continuous monitoring by Sustainability Promotion
・Waste generation: Medium- to long-term target of 0.5% average
Councilannual reduction in waste intensity
・Promotion of environment-friendly procurement through “Green
Procurement Standards”

7.3 By 2030, double the global rate of improvement in energy efficiency

Relevant SDG targets

12.5 By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse.
12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature

Environmental Initiatives
Measures taken in owned properties (Tokyu Plaza Omotesando Harajuku)
In the Tokyu Plaza Omotesando Harajuku, one of API’s flagship properties, various efforts
addressing environmental challenges are taken which include reduction of CO₂ emissions throughwind-power generation, conservation of water resources utilizing water-saving equipment, as well as
resource saving by using recycling materials.
On the rooftop named the “Forest of Omohara”, a nature-friendly environment with water mountainfor birds has been created. A large-sized rooftop garden with tall trees, such as zelkova and Katsura
trees, in the center of Omotesando and Harajuku areas, is registered as a “Birdpia” (a word coinedby combining bird and utopia) by the Japanese Society for Preservation of Birds. As part of a “green
network” consisting of Meiji Jingu shrine and zelkova trees near the property, the Forest of Omohara
links the urban area with a natural environment that is home to many birds and other living creatures.

23

＜Features of Forest of Omohara＞＜Dealing with 5 environmental challenges＞

Please refer to API’s website for efforts making in each property.
https://www.activia-reit.co.jp/en/sustainability/portfolio.html

24

Environmental impact reducing works
In accordance with the medium- to long-term asset management plan, in every fiscal period, API
undergoes engineering works to reduce environmental impacts such as installation of LED lightingsand energy-saving air-conditioners. Not only common areas, but tenant spaces also get renovatedoccasionally in the event of the tenant replacements.
＜Examples of engineering works to reduce environmental impact>

Environmental Performance

FY2015FY2016FY2017FY2018FY2019FY202086,660102,039

104,804

112,120

116,744

48,774(107,339)

0.23

0.25

0.22

0.22

0.21

0.29
(0.20)

0.05

0.03

0.03

0.04

0.02

0.14

Actual (total)(t-CO2)

34,19737,28540,91046,172

45,347

40,683

Scope 1
(direct emission)

-

-

-

-

-

1,465

Scope 2(indirect emission)

-

-

-

-

-

18,037

Scope 3(emission from tenants)

-

-

-

-

-

21,181

Intensity (total/Scope 1&2)
(t-CO2/㎡)

0.093

0.090

0.087

0.089

0.083

0.116
(0.07)

Actual(㎡)

526,515533,757

591,392

675,847

701,847

443,885

1.42

1.29

1.25

1.30

1.29

0.82

-

3,492

6,667

18,99230,76815,549

2,824

3,209

3,665

4,262

4,367

2,899

ActualEnergy consumption
per year(MWh)Intensity(Note 2)

(MWh/㎡)

Renewable energy generation per year
(MWh)

CO2 emissions per
year(Note 3)

Water consumption
per year

Intensity(㎡/㎡)
Recycled water (Grey water and Drainage)(㎡)
Waste generation per year (t) (Note 4)(Note 1) Principally the figures shown above are the cumulative amounts of the entire portfolio during each fiscal year. (number of properties FY2015：30, FY2016：37, FY2017：40, FY2018：42, FY2019：43, FY2020 : 41)(Note 2) Total amount of consumption fuel (gas, heavy oil, etc.), electricity and district heating / cooling of the properties.
For FY2020, the actual amount covers the area of the properties for which API has operational control of energy management. Figure in parentheses includes emissions by tenants, same as the previous fiscal years.
(Note 3) The factor and the method applied to the calculation are in accordance with "GHG Emissions Accounting, Reporting and Disclosure System" of the Ministry of the Environment. Figures reported for Scope 3 fall undercategory 13
and are limited to the data which was able to be collected from tenants.
Figures for intensity from FY2015 to FY2019 as well as that in parenthesis for FY2020 are calculated based on the total area of the properties with reference to the occupancy. Figure for FY2020 is total of the intensity for(Note 4) Excludes waste directly generated by tenants. Figure for FY2016 excludes properties of which data were not available (Figure represents 91.5% of the entire portfolio).

25

Green Certifications
API works to improve the ratio of the green-certified properties in belief that an environmentalfriendly portfolio will lead to enhancement of unitholder value in the medium to long term.
＜Overview of green certifications＞＜API’s green-certified properties＞
CASBEECASBEE

BELS
Tokyu Plaza Omotesando
Harajuku★★★★★

A-PLACE Ebisu Minami★★★★★

Q plaza EBISU★★★★

A-PLACE Aoyama★★★★★

Luogo Shiodome★★★★

icot Nakamozu (Konan bldg.)★★★★★

icot Mizonokuchi★★★★★

Q plaza SHINSAIBASHI★★★★

Commecial Mall Hakata★★★★★

A-FLAG BJUTSUKAN DORI★★★★★

Ebisu Prime Square★★★★

Kyoto Karasuma Parking Building★★★★★

Tokyu Plaza Omotesando
Harajuku★★★★★

A-PLACE Ikebukuro★★★★

Tokyu Plaza Akasaka★★★★★

A-PLACE Gotanda★★★★

A-PLACE Yoyogi★★★★★

A-PLACE Kanayama★★★★

OSAKI WIZTOWER★★★★★

TLC Ebisu Building★★★★

A-PLACE Ebisu Higashi★★★

A-PLACE Shibuya Konnoh★★★

Q plaza EBISU★★

Q plaza HARAJUKU(Bldg.A / Bldg.B)★★

A-PLACE Yoyogi★★

A-PLACE Ikebukuro★★

A-PLACE Gotanda

★★

★★★★

A-PLACE Shinagawa★

icot Nakamozu★★★★

icot Nakamozu (Bank bldg.)★

A-PLACE Shinagawa★★★★

A-PLACE Shinagawa Higashi★★★★★

A-PLACE Ebisu Higashi★★★★

Osaka Nakanoshima Building★★★★★

A-PLACE Shibuya Konnoh★★★★

Market Square Sagamihara★★★★★

A-PLACE Shibuya

Tokyo Low-Carbon Small and Medium-Sized
Model Building

Luogo Shiodome

A1

DBJ Green Building
Shiodome Building

26

★★★★★

Green Procurement Standard / Green Lease Agreement
Green Procurement Standard
As a member of TFHD, TRM shares the Group’s “Sustainable Procurement Policy” published on
January 31, 2020 and works on challenges to environmental crisis such as climate change. Our
objective is to work on this goal, together with all the stakeholders including our suppliers.
TFHD Sustainable Procurement Policy:
https://tokyu-fudosan-hd-csr.disclosure.site/en/themes/29
In line with the Group’s procurement policy, TRM established the “Green Procurement Standard”
to translate the policy into practical measures. This standard broadly states to suppliers thatenvironment-friendly procurement is to be carried out, and together with them, TRM works topromote more sophisticated efforts based on the Policy. The scope of application of this standard
includes direct or indirect transactions related to products, services, raw materials, anddesign/construction procured by TRM and API.
Green Lease Agreement
API and its tenants have concluded agreements which includes the green clause and share theimportance of preservation and improvement of the comfort and productivity of tenants andproperties. The green clause states that they should share information and work together for green
certification acquisition, environmental target setting, response to environmental regulations, etc.
API and one of its tenants have signed the memorandum of understanding on a green lease linked
to refurbishment works. It stipulates that when the tenant enjoys profit from energy-saving effectof the refurbished equipment the property owner invested in, the tenant shall return a reward to
the owner.
We keep making effort to multiply the green leases through developing deeper relationships withtenants.

Environment Management System
TRM established a unique environment management system (EMS) which applies PDCA cycle tocontinuously approach to environmental challenges. We are working to continuously reduce
environmental impacts in the management operation for API, through the cycle of four steps; settargets(P),

assessperformance(D),

analyzebudgetvs.

actual(C),

andimplement

countermeasures for a better performance (A). The Asset Management Department of Activia
Management Division reviews actual performances in its monthly meeting and reports the results
to the management once a year, then receives feedbacks and instructions for further improvement
for the following year, from the management.
＜PDCA cycle applied EMS＞

27

Green Bonds
API invests primarily in urban retail and Tokyo office properties. API seeks to increase unitholder
value by building and operating a portfolio of properties that are competitive in the medium to longterm. To build a portfolio with a stable and sustainable demand from our customers, we believe thatin addition to the location, use, scale, and quality of properties, reducing our environmental footprint
and contributing to the surrounding communities and environment are important.
API aims to further promote its sustainability initiatives through issuance of green bonds and invite
new investors to its investment corporation bonds by stimulating their demand who have interest in
ESG investment.
Green Bond Framework
・Use of proceeds
The proceeds from the green bonds will be allocated to funds for (i) acquisition of the Eligible Green
Projects which are existing or new buildings fulfilling the item A of the Eligibility Criteria defined below,or (ii) refurbishments fulfilling the item B of the Eligibility Criteria, or (iii) refinancing the existingloans/investment corporation bonds which have been allocated to funds to acquire Eligible Green
Projects or refurbishments.
・Eligibility Criteria
The proceeds of the green bonds will be allocated to the projects that conform to one or more of
the following criteria.
A. Eligible Green Projects
Buildings that have achieved the top two levels of one or more of the third-party green building
certifications/recertifications listed below within 36 months prior to the payment date of green bonds
or are expected to achieve:

B. Refurbishments
Refurbishments with a primary purpose of achieving one of the targets listed below and arecompleted within 36 months prior to the payment date of green bonds or are expected to becompleted:28

・Management of proceeds
API calculates the amount of debts of Eligible Green Projects by multiplying the calculable total bookvalue of the Eligible Green Projects* at end of the financial period immediately preceding each dateof bond issuance by its LTV (Loan to Value / interest-bearing debt to total assets) ratio. API will thenmonitor to ensure that the total amount of unredeemed green bonds does not exceed the amount ofdebts of Eligible Green Projects.
<Green balance sheet>・Reporting
As far as there is unallocated amount of funds, API will disclose on its website the list offinanced/refinanced Eligible Green Projects and refurbishments, allocation status including theamount of unallocated proceeds, allocation schedule and managing method of net proceeds of green
bonds at end of May each year. API also disclose that the amount of unredeemed green bonds does
not exceed the amount of debts of the Green Eligible Projects. After the issuance, as long as there isan unredeemed balance of the green bonds, API will disclose the amount of total book value of the
Eligible Green Projects and the amount of debts of Green Eligible Projects, as well as amount of
unredeemed green bonds at end of May each year.
・Impact reporting
If there is unredeemed balance of green bonds, API will annually disclose the summary, progress
and levels of certifications of the Eligible Green Projects. Additionally, API will annually provide thefollowing indicators of the Eligible Green Projects where API has control over energy usage:＜Indicators of the Eligible Green Projects>＜Impact Reporting>
Energy consumption
per year (MWh)CO2 emissions per year Water consumption(t-CO2)per year (m3)

Waste generation
per year (t)FY201852,171

22,614

271,0211,994

FY201944,66918,125

247,458

2,056

29

＜Outstanding Green Bonds＞
Total issued
amount (\ mn)

Interest
rate

Issuance date

Redemption date

Description

The 10th unsecured
investment corporation
bonds (green bonds)

5,000

0.220%

2019/7/9

2024/7/9

Unsecured, nonguaranteed

The 11th unsecured
investment corporation
bonds (green bonds)

4,000

0.530%

2019/11/18

2029/11/16

Unsecured, nonguaranteed

The 12th unsecured
investment corporation
bonds (green bonds)

4,500

0.510%

2020/10/21

2030/10/21

Unsecured, nonguaranteed

Total

13,500

-

-

-

-

30

SocialOur View on Society
We believe that engagements with all our stakeholders including unitholders, employees, local
communities, tenants, and suppliers are essential for API and TRM to continue businesses. Fostering agood relationship with them in the medium to long term is one of the significant elements to maximize
the unitholder value of API. Believing real estate as social instrument, which connect people living in
the city with other people, we are on a mission to continue our business in compliance with social
responsibility.

lifestyles in harmony with nature

Materiality(Social)

PolicyStatus / Examples

Human capitaldevelopment as a groupof professionals

・Disclosure of key employee data to present our human resources
strategy and status of efforts on employee health and well-being (ratioof female employees, number of female directors and managers,
・Promote human resource strategy that indicates the requirements turnover ratio, stress check participation ratio, etc.)
of desirable resources and facilitate development
・Support acquisition of business knowledge, skills, qualifications, and・Commitment to health and well-being of each employee
implement various trainings
・Deployment of measures based on TFHD's KPIs (work-style・Promote career development through periodic performance
reform, promotion of diversity)
evaluation/feedback
・Periodic Health Committee
・Introduction of various support systems leveraging on Tokyu Group
membership, etc.

Contribution to local
communities

・Enhance disaster prevention functions
・Prompt recovery of assets under management following
occurrence of a disaster・Educational activities on fire and disaster prevention and disaster
response
・Enhanced cooperation with local community

・Publication of capital expenditure/emergency reserves from disasterprevention perspective
・Improvement of seismic performance, Installation of emergency
generator, and establishment of BCP・Cooperation for disaster prevention, disaster response and infectious
disease prevention
・Sponsorship/participation/cooperation with local events

Health and well-being of
tenants

・Improve tenant satisfaction

・Extract issues and make improvements based on tenant satisfaction
surveySupplier Engagement

・Aim at smooth property management by utilizing expert know-how
of Tokyu Land Corporation, Tokyu Community, Tokyu Land SC
・Build/promote collaborative structure through periodic monitoring
Management, and the support agreement counterparty Tokyu
・Conduct training on environment, etc.
Fudosan Holdings Group companies
・Promote collaboration with all stakeholders through “Green・Share information and actively work on environmentally friendly
Procurement Standards”
procurement with PM/BM companies

11.3 By 2030, enhance inclusive and sustainable urbanization and capacity for participatory, integrated and sustainablehuman settlement planning and management in all countries

Relevant SDG targets

12.8 By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development andlifestyles in harmony with nature

Employee Engagement
API, as a J-REIT, cannot have employees as stipulated under the Act on Investment Trusts andInvestment Corporation of Japan. Therefore, the figures and descriptions provided herein refer tothose of TRM, the asset manager.
As a group of experts in real estate management, TRM provides high-quality asset management
services with objective to maximize the value of its shareholders, and to that ends, we promote ourown human-capital strategy in view of the importance of human capital development.
TRM is making continuous effort to have various systems to form a working environment andorganization enabling to realize and promote the health and comfort of employees.

31Human capital development & retention
・Employee skill development
TRM provides a wide variety of training systems and offers self-learning menu for the company’s
better investment management. Those training systems are not only for permanent employees but
also for contract employees.
➤Training program examples
Position-based trainings… Examples include orientation training for mid-career hires on wide
range of knowledge on asset management business andunderstanding of regulatory compliance; management training forsenior management and medium level employees; business skills
training and anti-harassment seminar for all employees
ESG training…
As part of awareness program on ESG investment, we invite external
experts to provide employees with periodic training for their deeper
understanding of ESG and introduction to new trends.
Courses to improve computer skill, English conversation and other lessons are also provided.
➤Support for acquiring business related qualifications
We support acquisition of necessary qualifications by employees in various measures including
financial aid for examination fees and class fees. We also hand in monetary reward once employees
pass specified examinations.
＜Status of employees qualification>
Qualification

Nb. ofemployees

Real Estate Broker

93

ARES* Certified Master

66

Certified Building Administrator

24

Chartered Member of the Securities Analysts Association of Japan

2

Real Estate Consulting Master

5

Real Estate Appraiser

7First-class Architect

8*Association for Real Estate Securitization

As of June 30, 2021

・Personnel system
We have regular communication opportunities with employees including one-on-one session withthe direct supervisor and review staff’s performance based on the objective of career development
set by each. We encourage each staff to have their own career plan and to acquire skills that arecompetent inside and outside of the company. ESG-related efforts and relevant items are included in
the annual target to set.
・Human resource exchange
TRM receives staff seconded from the Sponsor or group companies and dispatches its employees
to the Sponsor to provide its employees with varied professional experiences. Based upon the factthat the number of employees of TRM had increased to a certain size, partly because of the merger
happened in 2017, we decided to conduct shuffling of employees among different divisions in order
to raise career development of our employees. Meanwhile when conducting such occupational
relocation, we pay close attention to the information firewall between the different business divisions.

32➤Exchange with university students
API and TRM participated in 2019 in the IR presentation competition organized by USIC, auniversity students’ investment union and provided them with an opportunity to learn. The Sponsor
organizes intern programs and creates opportunities to communicate with students. TRM is not
hiring new graduates, though those from the Sponsor are seconded to TRM. Through such efforts,
we will continue to work to retain talented employees and activate our organization.

For work-life balance & health of employees
・Working-style reform
Recently, under the working-style reform trend including rectifying the practice of working longhours, TRM actively takes approaches to introduce more flexible working style of employees with
objective to improve their work-life balance.
➤Paid-leave usage encouragement
Every year, employees are required to set up so-called “commitment holidays”, a seven-day paid
leave (five days in a row + two days immediately before or after that week) and to share suchcommitted calendar within the teams they belong to. TRM is also creating business environment
for the employees to digest their allocated paid leaves, by proactively setting up recommended days
to use paid leaves.
➤Flex-time work system
We have introduced a flex time working system for all employees.
Core time is set between 11:00 and 15:00, and employees are free to set start and finish of theirwork hours around the core time to support more flexible working style considering the wide varietyof living environment of each individual.
➤Work-from-home system
The Covid-19 outbreak pulled the need for introduction of work-from-home, and we are working
to improve productivity with reducing commuting time to workplace. Use of serviced office spaceis also allowed under preset rules.
➤Effort to reduce overtime
In order to prevent excessive long working hours, TRM is taking necessary measures. The
employees are required to set an upper limit of overtime working hours at the beginning of the fiscal
year, and such objectives are regularly monitored and reminded. In certain cases, we intentionallyraise them as a meeting agenda if the working hours are excessively long.
・Welfare programs
TRM values its employees, their well-beings, and healthy performance in work, and provides staff
with various welfare programs to improve their satisfaction.

33

➤Cafeteria plan
To support self-support and independence of permanent employees, we provide them withfinancial aid for medical fees, subsidies for use of sports facilities, studying, volunteer activities,
employee shareholding program, and use of the facilities Tokyu group companies operate.
➤Welfare programs
・Various systems are in place to provide support for employees at each stage of life, such as
maternity leaves, childcare leaves, child medical leave, nursing-care leave・We support asset formation by permanent employees, by inviting external financial planners tooffer introductory sessions on topics including defined contribution pension matching program which
TRM offers and the insurance system by the Tokyu group.
・We increased the number of available facilities to enable more employees to use the popular
exclusive resort membership “Tokyu Harvest Club.”➤Cumulative unit investment program

We provide employees with an opportunity to invest in API’s investment units. We support
to build their personal assets through offering financial incentives and encourage them toraise their consciousness of API’s management performance, which should lead to thecontinual growth of API and enhancement of API’s unitholder value.
・Internal communication
TRM periodically organizes employee satisfaction surveys and explanatory sessions on the corporate
annual objective and medium- to long-term vision, for a more profound understanding between thecompany and employees, expecting to develop the productivity of our organization where employees
can deliver their best performance.
➤Employee study groups
Younger employees have led voluntary organization of cross-divisional study
groups to share information on businesses unique to each division, and onnecessary knowledge/skills.
➤Support for company circle activities
Financial support is provided to employees for company club activities.
➤Luncheon
To enhance communication among employees, regular luncheons by groups
of a small number of staff have been organized.

34

・Employee health & comfort
TRM is making effort to maintain the workplace healthy and comfortable, encouraging employees
to show the best performance.
➤Working environment
Workplace of TRM is in Shibuya, an exciting and innovative city where the areas people live and play
are closely connected. Employees can take beverages for free and use individual spaces, and a spacefor refreshment is created with green on the terrace of the building where TRM is located, Shibuya
SOLASTA. The building earned the CASBEE Wellness Office, a recognition of the building’s ability topromote health and comfort of people work in the building.

Also, as a preventive measure against COVID-19, the workspace of TRM is equipped with protective
panels on the desks in office space and meeting rooms, as well as air purifiers at the elevators.

➤Healthcare
Employees are obliged to take annual medical checkups. There is also a mental health consultation
desk.
➤Health Committee
Health Committee is established to improve employees’ occupational health. The Committee
examines labor-related problems occurred in the company, reports the results of investigation on
comfort and safety in the workspace, and takes measures to increase awareness for mental andphysical health by poster, etc. Lectures by industrial physicians on related themes are held.
➤One-on-one session with HR
Once a year, employees have one-on-one session with HR department, where they can discussand share their career development plan and explain their troubles and expectations related to therelationship with supervisors and colleagues.
➤Employee satisfaction survey
Every year, TRM conducts an employee satisfaction survey with a third-party partner. Based upon
the results of the survey, we are taking variety of means to improve employee satisfaction level.

35

FY2019

FY2020

Employee engagement level*

62.6

60.8

Nb. of responses / Nb. of eligible employees

95 / 95

96 / 98

Participation rate

100%

98%

*Quantfies the attachment and trust between employees and the company.

Diversity
TFHD accepts the difference in a variety of attributes such as gender, age, nationality and handicap
and brings about innovation by showing individual ability to the maximum and continues to create
value through its business activities. TRM is working to make a workplace without any discriminatory
treatment and compensation due to different attributes, where all employees can rely on.
https://tokyu-fudosan-hd-csr.disclosure.site/en/themes/50
TRM shares the Human Right Policy published in January 2020 by TFHD and carries out its businessin belief that respect the human rights of stakeholders of the group including employees is essential
and it is what all companies are expected to do.
https://tokyu-fudosan-hd-csr.disclosure.site/en/themes/32

Respecting basic labor rights and aiming at coexistence and co-prosperity with employees, TFHD
supports and respects the OECD Guidelines for Multinational Enterprises, international labor
standards and Guiding Principles on Business and Human Rights. In December 2016, the Group
stated its support for the UN Global Compact. In accordance with the ten principles of the UN Global
Compact in the areas of human rights, labor, environment and anti-corruption, we promoteresponsible management and contribute to a sustainable society.
TFHD’s support for UN Global Compact shall apply to all group companies including TRM.
https://tokyu-fudosan-hd-csr.disclosure.site/en/themes/36

36

Key Employee Data
Apr. 30, 2019

Apr. 30, 2020

Apr. 30, 2021

93
55
38
41
21
20
12
2
10
3
0
3
40
32
8
4
3
1
27
23
4
1
1
0
10
3
7
0
0
0
3.5 yrs
3.1 yrs
4.0 yrs

97
55
42
47
25
22
12
1
11
7
1
6
38
29
9
4
3
1
29
26
3
1
1
0
8
5
3
1
1
0
3.9 yrs
3.4 yrs
4.4 yrs

106
59
47
53
30
23
14
1
13
8
2
6
39
28
11
4
4
0
31
26
5
3
3
0
6
5
1
0
0
0
4.4 yrs
3.6 yrs
5.5 yrs

Number of employees*1
MaleFemaleOf which permanent staff
Male
FemaleOf which contract staff
Male
FemaleOf which temporary staff
Male
FemaleOf which seconded from TLC
MaleFemaleNumber of Directors*2
Male
FemaleNumber of senior management
Male
FemaleNumber of employees aged 60 or more
Male
FemaleNew hire
Male
FemaleTurn over*3
MaleFemaleAvg. aggregated years of service *4
MaleFemaleHealth check participation
Stress check participation
Annual paid leave per capita
Ratio of handicapped employee
Monthly avg. overtime per capita
Work-related injury and death
Absentee rate
Ratio of employees on leave
Childcare leave users
Childcare short working hour
/Childcare off-peak commuting users
Nursing-care leave users
Home office utilization rate *1

FY2018100.0%
97.8%
10.8 days
0.0%
29.4 hours
0
0.3%
0.0%
0

FY201996.0%
100.0%
11.5 days
1.2%
21.2 hours
0
0.5%
0.0%
0

FY202094.7%
98.9%
9.9 days
1.0%
19.4 hours
0
0.4%
0.0%
3

2

1

0

0
-

0
100.0%

0
100.0%*1 For FY2019, the rate represents the ratio of employees utilized home office from March to April 2019
*2 Financial year from April of the year to March of the next year

Training hours per capita
Training expense per capita

FY202027.3 hours¥44,906*1 Trainings include those for human capital development, personal skill development and essentialtrainings related to ESG, compliance and risk management.
*2 ESG trainings are mandatory for all employees and participation rate for FY 2020 is 100%.
*3 Financial year from April of the year to March of the next year

*1 Permanent staff, contract staff and staff seconded from TLC*2 Includes contract and temporary staff*3 Permanent staff*4 Includes the years working at the asset managers before merger to TRM in July 201737

Contribution to the Local Communities
API and TRM believe that contribution to local communities lead to the improvement in value ofthe API’s owned properties and ultimately by the unitholder value. We make a variety of efforts inthe owned properties to enhance communication with the local communities with an expectation thatour business operation is to serve an important role for the society.
Tokyu Plaza Omotesando Harajuku
In the “Forest of Omohara” at the rooftop terrace of Tokyu Plaza Omotesando Harajuku, we set awater fountain for birds and created an environment comfortable for them and other living creatures.
A variety of experiences are proposed to local communities including an installation of bird houses
hand-crafted by kids from a neighborhood elementary school and vegetable harvest experience by agroup of kindergarten children.

DECKS Tokyo BeachWe created a playground for kids in the floor for children’s wear and products, and installed furnitureand green area on the Seaside Deck, offering visitors from inside and outside of Japan a refreshingspace.

Shiodome Building
We create a community in the area through participation to the local events. Vacant spaces of theproperty are offered to the “HAMASITE Summer Festival”, a traditional summer event, which is joinedby various stakeholders in the area including residents, workers, tenants, PM (property managers)
and BM (building managers), etc. Unfortunately, this event was not held for fiscal 2020 due to the
COVID-19 pandemic.

38Preparation for disasters
In the owned properties of API, we hold disaster drills to test rapid response under emergency andimplement BCP-purposed renovation works. The properties are equipped with AEDs (AutomatedExternal Defibrillator), other emergency supplies, and fixtures.

Donation through regional revitalization support tax payment
As part of the effort to the “contribution to local communities” that TRM shares with API as one ofits Materiality, it participated a fundraising program to the Hokkaido prefecture utilizing the regional
revitalization support tax payment system. We expect that the participation to the program helps tofurther strengthen relationship with the community, TRM and API.

Tenant Engagement
API believes that its owned properties should always meet tenant preferences to enhance themedium- to long-term value of our unitholders, and therefore tenant satisfaction serves an essential
role for that. To that end, we consistently communicate with them to understand their needs andreflect them for our asset management operation.
Satisfaction survey
API makes effort to improve tenant satisfaction, regularly conducting survey towards tenants inoffices and a part of commercial properties to understand their needs and complaints. The results ofthe survey previously conducted scored low in terms of cleanliness of the office buildings, and after
providing intense training to building keepers and renovation works to toilets and kitchenettes, there
was a significant improvement in satisfaction in the survey FY2020.

＜Tenant Satisfaction Survey results＞

Tenant awards / customer service competition
Three times a year, we award a commercial tenant with the best tenant prize to with an aim toencourage operations of all the tenants and to raise employee motivations. Customer service
competition and training are also organized with objective to further raise the level of the customer
service of tenant’s staff and therefore increase customer satisfaction.

39

Effort to advance health / wellness
We regularly implement renovation works at common area to provide our tenants with comfort
working space, which reflects the results of tenant satisfaction survey and discussion with PMs. Our
efforts for tenants’ health and comfort include renovation of areas catching people’s attention suchas restrooms, mini kitchens, elevators and escalators, and as preventive measures against COVID19, installation of antiseptic solution, temperature inspection, anti-virus coating on the walls, etc.
Cooperation with tenants
As part of approaches for cooperation with tenants, we created a sustainability-guidance leaflet anddistributed to them. The guidance introduces our initiatives presenting practical examples with a viewon environment and health and wellness of working people. API continue to enhance sustainability
effort in cooperation with tenants.
Green lease agreement (Cf. page 27)

Supplier Engagement
TRM recognizes the importance of cooperation with its suppliers, as stated in the Sustainability Policy,
that it provides initiatives and procurement with consideration to the environment and society,through engagement to suppliers such as PM. As part of the initiatives, TRM established the Green
Procurement Standard and monitors ESG consideration in the operation of its important suppliers
including PMs.
ESG trainings co-organized by AM and PM
We work to foster a culture that ESG initiatives are to be taken by our entire supply chain, notlimited to the officer and employees of TRM. To that end, ESG training sessions are co-organized by
TRM and PMs. In FY2020, TRM organized also virtual seminars themed ESG trend, Materiality andapplication of the Green Procurement Standard.

PM awards
This award recognizes the outstanding performance of property management staffs contributing
to upward rent revision, lease-up, prevention of lease cancellation and downward rent revision,
contracting green lease, implementation of renovation works to reduce environmental impact, etc.
We expect that this award helps to foster a unified partnership between TRM and property managers.
Cooperation with supplies through the Green Procurement Standard (Cf. page 27)
TRM communicates the principle of the Green Procurement Standard to its direct and indirect
suppliers it works with, aiming to further enhance its initiatives on a basis of mutual understanding.

40