TOKYO TATEMONO GROUPINTEGR ATED REP ORT 2023

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

1

ForewordThank you for taking the time to review the Tokyo Tatemono Group Integrated Report 2023.
We have been publishing integrated reports since 2019, and this is our fifth. I speak regularly with our shareholders, our investors and a wide range our stakeholders. Each year, I keep those interactions in mind as we work to improve the content of thisreport. I hope it can serve as a tool to help people understand our company more deeply and to enrich our conversations.
We will continue working to enhance and improve the content of our disclosure and the transparency of information so that we
can clearly communicate our management vision and goals. I hope that you will read this integrated report in full and share frankly

Corporate

any thoughts or impressions you may have. We appreciate your continued support.

Philosophy

July 2023
Representative Director, Senior Managing Executive Officer

Residential Business:

A History of Value Creation............................................................................. 02
Value Creation Process........................................................................................ 05
Financial and Non-Financial Highlights..........................................

06

Corporate
StanceProgress under the Medium-Term Business Plan

Corporate Philosophy and Corporate Stance...................... 01

We aim to grow the Company and to create a prosperous society,taking pride in the level of trust placed in us for more than a century.

Residential Business................................................................................................ 28

The Tokyo Tatemono Group’s Value
Creation Story“Trust beyond the era.”

We support affluent and dream-filled living.
We aim to create comfortable urban environments.
We create worthwhile spaces offering peace of mind.

and Strategies Going Forward.......................................................... 29
Asset Service Business........................................................................................ 32
Asset Service Business:
Progress under the Medium-Term Business Planand Strategies Going Forward.......................................................... 33
Other Businesses......................................................................................................... 34

The Tokyo Tatemono Group’s Value
Creation and Vision

A Sophisticated Approach to ESG Management........... 35

Message from the CEO....................................................................................... 08

Environmental Strategy........................................................................................ 38

Long-Term Vision and Materiality........................................................... 36
Material Issue KPIs and Targets............................................................... 37

Evolution of Medium-Term Business Plans.............................. 12
Progress on the Medium-TermBusiness Plan (2020–2024)........................................................................... 13
Message from the CFO....................................................................................... 15

The Tokyo Tatemono Group’s Value
Creation Foundations
Human Resources Strategy.......................................................................... 43

The Tokyo Tatemono Group’s Value
Creation Initiatives

Social Initiatives............................................................................................................... 47

Special Feature: Urban Redevelopment Project

Risk Management Initiatives

for Yaesu 1-Chome East Area in Front ofCompliance Initiatives............................................................................................. 60

External Directors Roundtable................................................................... 48
Corporate Governance........................................................................................ 51..........................................................................

59

Tokyo Station (Districts A and B)............................................................ 18
Special Feature: Employee Roundtable........................................ 21
Commercial Properties Business........................................................... 24
Commercial Properties Business:
Progress under the Medium-Term Business Planand Strategies Going Forward.......................................................... 25

Data Section
Key Financial and Non-Financial Data............................................ 61
Financial Statements............................................................................................... 63
Corporate Data................................................................................................................ 66

Editorial Policy
The Tokyo Tatemono Integrated Report 2023 has been prepared with the goals of enhancing communication
with stakeholders and fostering understanding regarding the intentions of the Tokyo Tatemono Group to create
value over the medium to long term through the provision of financial and non-financial information. For futurereports, we intend to incorporate feedback from readers to improve the content.
Reporting Period
This report primarily covers fiscal 2022, the fiscal year ended December 31, 2022. However, some informationon activities before or after this period and forward-looking forecasts are also included.
Scope of Reporting
The scope of this report includes Tokyo Tatemono Co., Ltd. and Tokyo Tatemono Group companies.
Referenced Frameworks
In preparing this report, we referenced the Guidance for Integrated Corporate Disclosure
and Company Investor Dialogues for Collaborative Value Creation: ESG Integration, NonFinancial Information Disclosure, and Intangible Assets into Investment released by the
Ministry of Economy, Trade and Industry and the IFRS Foundation’s International
Integrated Reporting Framework. Non-financial information has been disclosed with reference to the standards of the Global Reporting Initiative.
Disclaimer Regarding Forward-Looking Statements
Data and information regarding future outlooks provided in this integrated report are forward-looking statements
based on the Company’s judgments in light of currently available information. Actual results may differ materiallyfrom those projected as a result of economic conditions, market trends, demand fluctuations, foreign exchange
rate movements, and other factors.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

2

A History of Value Creation
A pioneer of the modern real estate industry and driven by ideals inherited from Zenjiro Yasuda, the founder not only of the Company but of the former Yasuda conglomerate, Tokyo
Tatemono has been a trailblazer since its founding. With a solid 125-year track record of value creation, we have established three distinct pillars of strength.

Strength 1

1896
1945

Strength 2

Circa

1990

Ingenuity and Problem-solving Ability to Meet the Needs of Customers and Society
Japan’s Oldest Comprehensive Real Estate Company, Created with the Aim ofModernizing the Real Estate Trade
Urbanization progressed as infrastructure and other improvements were made and demand for real estate was on the rise.
Unfortunately, the real estate trade of the time was highly inefficient and rife with fraud.
It was amid this business environment that Zenjiro Yasuda founded Tokyo Tatemono in 1896 with the aim of modernizing
the industry and promoting urban development while selling and contracting the construction of buildings using real estate
financing and loans.

The Expansion of Commercial Properties and Residential Businesses amid Post-War
Rebuilding Efforts and Rapid Economic Growth

The Company’s first
headquarters

Zenjiro Yasuda

The post-World War II era saw high demand for reconstruction-related demand driving fast-paced growth for Tokyo Tatemono as a company as well as
throughout our industry.
During Japan’s period of rapid economic growth, we responded to a serious urban housing shortage and rising demand for residences near workplaces
by making a full-fledged entry into the condominium business. Supplying high-quality yet budget-friendly condominiums, we garnered customer support.
At the same time, we focused efforts on developing office buildings to meet the rising demand as urban functions came to be increasingly consolidated
in city centers.

Shinjuku Center Building has
become a west Shinjuku landmark and contributed greatly
to raising Tokyo Tatemono’s
profile and subsequent business expansion. (Built in 1979)

Corporate Culture Able to Read the Times and Take on New Challenges
Striving to Differentiate Ourselves by Leveraging the Comprehensive Strength of
the Group
After the collapse of Japan’s economic bubble, we deftly adapted to the changing business environment by, in part, planning seismically isolated and fixed-term lease condominiums and proactively participating in redevelopment projects. In
1998, we also proactively expanded into the real estate investment market, conducting the first securitization of real estatein Japan under the Special Purpose Company Act. In 2003, we unified our condominium operations under the Brillia brandand in 2004,began giving tours of construction sites, the first in the industry to do so.
In the Commercial Properties Business, we rapidly grew as a comprehensive real estate developer with repeated successes in highly difficult complex redevelopment projects as well as private finance initiative (PFI) projects.
Olinas is Tokyo’s first complex redevelopment
project in which three aspects of urban planningwere determined simultaneously. (Built in 2006)

KASUMIGASEKI COMMON GATE is apioneering public-private, largescale redevelopment project executed using a private finance initiative(PFI) structure. (Built in 2007)

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Strength 3

Late

2000s

Accumulated Trust, Track Record of Accomplishments, and Expertise
Urban Development Leading to a Future of Added Value Creation
Drawing on its accumulated expertise, Tokyo Tatemono aggressively undertakes ever larger redevelopment projects expected to create added value.
Although we recorded a loss following the global financial crisis, we strengthened our financial standing in part through the sale of some assets.
We continue to participate in multiple large-scale redevelopment projects and expand our portfolio of high-quality real estate in part through the acquisition of various
assets, including logistics facilities and hotels.
Brillia Tower Ikebukuro is Japan’s firsthigh-rise condominium that integrates
the main building of a municipal office.
The property features a low-rise sectionthat serves as the main Toshima Ward
office building, along with retail facilities
and offices. The high-rise tower section
houses 432 residential units. (Built in2015)
NAKANO CENTRAL PARK enables an efficient office layout
through the use of a mega plate (for an uninterrupted single
floor) measuring 1,500 tsubo (nearly 5,000 m2) while offeringa new style of working in an open, green environment. (Built
in 2012).

2020

Brillia Tama New Town is Japan’s largest apartment complex
reconstruction project. (Built in 2013)

Becoming a Next-Generation Developer
We Aim to Provide Value of Place and Maximize Value of Experience
Since 2020, in line with our long-term vision of becoming a next-generation developer by around 2030, we have striven to offer better solutions to society’s problems
and raise our own growth as an enterprise to a higher level.
We are working to enhance ESG management as set out in the medium-term business plan spanning fiscal 2020 to 2024 and are pursuing sustainable, high valueadded urban development based on the Group’s material issues.
Hareza Ikebukuro is a large-scalecomplex on the site of the former
Toshima ward office and Toshima
public hall (Built in 2020)
With eight theaters, we frequently
promote different genres of culture at
the same time and strive to make theentire area more exciting and attractive through area management activities enabled by the formation of ageneral incorporated association.

Urban Redevelopment Project for Yaesu
1-Chome East Area in Front of Tokyo
Station is a large-scale redevelopment
project that includes the Company’s
former headquarters. (Constructionslated to finish in FY2025)
We are currently working hard on
the consolidation of advanced urban
functions that help strengthen Tokyo’s
competitiveness on the international
stage while pursuing high value-added
urban development that connects local
history and culture to the future.

3

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

The Tokyo Tatemono Group aims to realize its long-term vision of becoming a next-generation developer by continuing to implement a cycle ofmaximizing value of place and value of experience by leveraging the strengths we have cultivated through more than 125 years of business.

Strength 1

Ingenuity and Problem-solving
Ability to Meet the Needs ofCustomers and Society

Target for 2030 and Long-Term Vision

Becoming a Next-Generation Developer

At Tokyo Tatemono, we listen to the needs of ourcustomers, society, and local communities inorder to sincerely address their problems andrefine our proposals.

The Tokyo Tatemono Group’s aim is to be a good company
for stakeholders by leveraging its businesses to solve social issues
and achieve higher levels of growth as a company.

Strength 2

Corporate Culture Able toRead the Times and Take on
New Challenges

Solving Social
Issues

Maintaining an enterprising spirit that stays
ahead of the times is one of our guiding principles. Reflecting this principle, we have successfully promoted various industry firsts.

Strength 3

Accumulated Trust, Track
Record of Accomplishments,
and Expertise
We work in collaboration with local residents andgovernments to carry out many redevelopment
and reconstruction projects and leverage ouraccumulated trust, track record of accomplishments, and expertise to tackle new projects.

Growth as a
Company

Maximizing Value of Place andValue of Experience

4

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

5

Value Creation Process
The value creation process of the Tokyo Tatemono Group is a cycle based on the corporate philosophy of “Trust beyond the era.” As input, we use various types of capital. Our output (realestate and services) comes from business activities enabled by the Group’s strengths. The outcome (results and value) further strengthens our capital.
Target for 2030 and Long-Term Vision

Input
Financial Capital

Becoming a Next-Generation Developer

A sound financial foundation supporting
business activities

Offering solutions to society’s problems and achieving growth as an enterprise

Total assets 1,720.1 billion yen
Debt-equity ratio 2.2 times
Interest-bearing debt/EBITDA multiple 11.1 times

Maximizing Value of Place and Value of Experience

Business CapitalBusiness activities

A portfolio with a good balance between
long-term assets generating stable income
and short-term turnover assets with highcapital efficiency

Output / Outcome
Medium-Term Business Plan
(2020-2024)
Consolidated business profit* of
75 billion yen

uation by stakeholders
Eval

Property and equipment/intangible assets 947.6 billion yen
Balance of real estate for sale 414.9 billion yen

Five Key Strategies

Social and Relationship CapitalIntellectual Capital

Natural Capital

Various eco-friendly business activities
Measures to promote the development of ZEB and ZEH
Shift to renewable energy
Various measures aimed at realizing a circular economys

An Evolved Approach to ESG Management

Property sales•Real Estate Transactions
and Parking Business•Real Estate Fund Business•Leisure and Child Care
Business

n
tio
olu
gs
idin
Prov

Expertise in large-scale redevelopment
projects and residential reconstruction
underpinned by our track record
Management and operations drawing on theGroup’s integrated strengths

Services•Sales of condominiums•Property sales to investors•Overseas businessLeasing•Building Development and Leasing

I

Human Capital

Highly specialized, diverse human resources
who have gained the trust of customers

Value created by undertaking identified material issues

Creating value of place andvalue of experience
Coexistence with the earth
and the environment
Value-creating talent

Number of Group employees: 5,878
Real Estate Brokers: 687
Real Estate Appraisers: 19
First-Class Architects: 89
Note: The above amounts and figures are as of December 31,
2022. (However, only the figures for certified people are
as of March 31, 2023.)*Consolidated business profit = consolidating operating
profit+ share of profit (loss) of entities accounted for using
equity method

Shared Values with Society
de
nti
fyi
ng
nee
ds

Relationships with a broad range of customers and tenants as well as a wealth of information for new projects

Strengths developed through 125 years of businessCorporate Philosophy “Trust beyond the era.”

Realizing sustainability management

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

6

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Financial and Non-Financial Highlights
Financial Highlights
Operating Revenue

Business Profit /Profit Attributable to Owners of Parent(Billion yen)

Business profit

340.4 349.9
323.0 334.9

66.3
51.6

47.1

Business Profit per Segment(FY2022)

Other
7%

Other 5%

23.1

4.0

Asset Service
14%

Asset Service 10%

Profit attributable to owners of parent(Billion yen)

273.3

Operating Revenue per Segment(FY2022)

27.2

49.8

29.7

47.9
31.7

Commercial
Properties
41%

50.2
43.0

349.9

34.9

7.3

66.3

145.1
Residential
31%

billion yen
Residential
38%

Commercial
Properties
54%

41.2

billion yen*

23.3

131.3
*After elimination and corporate

FY2018 FY2019 FY2020 FY2021 FY2022

FY2018 FY2019 FY2020 FY2021 FY2022

Debt-equity Ratio

Interest-bearing Debt / EBITDA Multiple(Times)(Times)2.5

2.5

Earnings per Share (EPS) / ROE
Earnings per share (EPS) (Yen)Annual Dividend per Share /Payout Ratio

ROE (%)

Annual dividend per share (Yen)

206.15

2.5
2.3

2.2

12.7

12.6

13.4

13.3

11.1
125.79141.597.9FY2018 FY2019 FY2020 FY2021 FY2022

FY2018 FY2019 FY2020 FY2021 FY2022

152.128.2

27.8

167.35

8.3

8.7

10.0

FY2018 FY2019 FY2020 FY2021 FY2022

35

29.0

30.2

Payout ratio (%)

30.5

31.5
65

41

46

51

FY2018 FY2019 FY2020 FY2021 FY2022

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

7

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Financial and Non-Financial Highlights* For detailed information and notes on each item, please refer to the Data section of the Sustainability Report.
(Sustainability Report 2023) Data (Environment and Social) p. 85-91

Non-Financial Highlights
CO2 Emissions

Renewable Energy (electricity)
Usage Rate

Scope 1 (fuel-derived)

Scope 2（％）

Scope 3

Waste Emissions per Unit Load of
Production and Recycling Amount
Waste emissions per unit load of production (ton/thousand m2)
Recycling amount (%)(Thousand t-CO2)

1,289

Percentage of Management Positions
Held by Women
（％）

5.3

5.3

1,101

7.2
943

970

11.2

733

1,172

65.7

7.2

6.0

60.9

5.0

4.6

835
626

No
data

116
15

105
12

96
13

No
data

88
19

FY2018 FY2019 FY2020 FY2021 FY2022

No
data

No
data

1.8

No
data

FY2018 FY2019 FY2020 FY2021 FY2022

Percentage of Childcare Leave Taken(men)

Average Annual Paid Leave Utilization
Rate

（％）

（％）

No
data

No
data

FY2018 FY2019 FY2020 FY2021 FY2022

Average Annual Training Hours

FY2018 FY2019 FY2020 FY2021 FY2022

Health Check-up and Reexamination
Rate
Percentage of employees who underwent a health check-up
Health check reexamination rate

67.8
57.7

(%)

18.3

57.5
51.2

50.0

15.8

14.4
12.0

100

100

94.0

100

100

100
98.0

98.3
83.7

12.2

35.3
63.0
18.2
13.0
4.8
FY2018 FY2019 FY2020 FY2021 FY2022

No
data
FY2018 FY2019 FY2020 FY2021 FY2022

FY2018 FY2019 FY2020 FY2021 FY2022

FY2018 FY2019 FY2020 FY2021 FY2022

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

Message from the CEO“Becoming a Next-Generation
Developer” by drawing on our
personal strengths to provide value
in our everyday operations

Representative Director
President and CEO

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

8

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

9

Message from the CEO

1

Engaging in urban development as a local of YaesuNihonbashi-Kyobashi area

Founded 127 years ago in the Yaesu-Nihonbashi-Kyobashi area, Tokyo Tatemono is a true local
and has worked with nearly everyone in the district. The Yaesu Project, a large-scale redevelopment project that encompasses our former headquarters building, is slated for completion in fiscal
2025 as an area of high-rise mixed-use buildings in front of Tokyo Station that will integrate tradition and modernity.
Well aware that real community development does not end with the construction of a building, we
will continue to work cooperatively with others in the community to achieve more than a single company is able to do on its own. This project is in line with one of our material issues—strengthening
Tokyo’s competitiveness as an international city—and is essential to Japan’s future prosperity.
The Yaesu-Nihonbashi-Kyobashi area is one of the most valuable areas in Tokyo and we areproud to be contributing to the city’s competitiveness through a number of projects.
By fostering strong relationships with the community, passing on traditions and culture to thetial. Sometimes new project propositions come in thanks to the referral of a satisfied customer. We

next generation, and offering appealing urban infrastructure and services that will aid in Tokyo’s

constantly aspire to be a business with a reputation that grows organically through word of mouth

continued globalization, we will display our true worth as a developer.

and to further expand on this foundation because in some ways the world is smaller than you
imagine. When you get right down to it, a company’s strength comes down to retaining personnel
with the requisite personal strengths.

2

The Company’s strength lies in everyday
personal strengths

We have established “Trust beyond the era.” as our corporate philosophy. The conviction thattrust is something that, once tarnished, can never be returned to its original luster, no matter how
much time passes, is something I keep firmly in mind. Behaving with sincerity is a valuable skill.

The ordinary personal strengths of our employees are indispensable to our continued business asEvery one of our employees considers the best way to gain customer trust and communities anda developer. Involving more than 80 landowners, the Yaesu Project is one of the most challenging

then consistently acts accordingly, creating relationships and work that leads to future involvement.

redevelopment projects in Japan in terms of securing agreements across the board. When working

I believe this mindset is evident in the way we carry out everyday actions, such as greeting others,with individuals or corporations, the Company assigns responsibility for directly communicating

keeping promises, and maintaining eye contact during conversations. In light of this, thewith the clients to a single employee. They must consider: How do we gain their full trust? PutCompany’s ideal job candidates are trustworthy people who forge their own paths. At the samethem at ease with entrusting us with their business? Make working with us even more appealing?

time, we must never lose sight of the need to be diligent and thorough.

Building solid one-on-one relationships over time through repeated contact eventually bears fruit,leading to the acquisition of projects and business success.
When building condominiums, it is not enough to simply subdivide buildings. Over the years, we

The Company’s corporate culture and DNA have played a role in shaping this mindset, whichmust be regularly reinforced and passed down. In the last few years, our employee engagement
survey has identified a lack of communication as an issue, so we have launched various measures

have formed agreements with numerous landowners and management associations and thento redefine the Company’s essential “goodness.” We have recently expanded our workforce, bring-received orders for new reconstruction projects, creating a virtuous cycle; the sealing of deals often

ing in both new graduates and mid-career professionals. Even so, we are a company with a limited

happens for reasons that have nothing to do with money, among them the trust that comes withnumber of employees, and we want to cultivate our strength by fostering a sense of unity.

the Tokyo Tatemono name or a client wanting to see things through to the very end with a trusted
account manager. For developers, securing a consistent stream of future quality projects is essen-

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

10

Message from the CEO

redevelopment projects that will be completed in the near term, we have determined that for us
there is no cause for serious concern.
In the Residential Business, sales prices are still on the rise due to a low interest rate environment and an increase in wealthy individuals in Japan. Interest in residences has been growing
since the start of the pandemic. Owing to these factors, the market has remained stable. Also,
prices are unlikely to fall because of a limited supply of newly built condominiums. In fiscal 2022,
we were able to record a very high gross margin in excess of 30% for properties scheduled fordelivery. Fiscal 2023 kicked off with the percentage of agreements for properties scheduled fordelivery at over 70% and projections for fiscal 2024 call for the year to begin with the percentage atover 50%, as sales proceeded apace. We do not expect this business environment to changemuch and are not concerned about the outlook for the Residential Business in the Plan.
Meanwhile, in property sales to investors, which has expanded as a profit growth driver over thecourse of the Plan, we have been acquiring a diverse stock of assets, including logistics properties,
and have been able to secure higher than expected sales prices. We recognize that there are concerns, especially among overseas investors, about the decline in the trading market due to rising interest rates, however, cash remains overabundant in Japan and steep interest rate hikes are unlikely, so I

3

Expecting a solid business performance for the remaining
two years of the medium-term business plan

do not think there will be a significant impact on achieving the targets of the Plan.
Of course, due to changes in the business environment since the Plan was formulated, there area few businesses where profit has been lower than anticipated. However, the aforementioned

Looking back on the five-year medium-term business plan that began in 2020 (the “Plan”), I realize

mainstay business results and property sales were able to offset any shortfalls. We are now even

we have made steady progress despite some unanticipated events. Kicking off at the start of themore confident that we will achieve the goals of the Plan.

COVID-19 pandemic, the first three years were filled with uncertainty. However, the negative impact
on our business performance proved to be not that significant, and some aspects of our businesseven benefited. Accordingly, the Company’s results remained solid, especially for our mainstay
Commercial Properties Business and Residential Business.
In the Commercial Properties Business, the market’s vacancy rate rose due to effects of the pan-

4

Continuing discussions aimed at sustainable growth
and rational decision making

demic, but we think the effects were temporary and will settle as things return to normal. In addi-

When considering sustainable growth, the Company’s most pressing concern is the magnitudetion, we are aware that a number of companies have decided to permanently change theirand duration of the rising trend in construction costs. Although we have been seeing prices for

employees’ workstyles by switching to a focus on remote work and some have reduced their officematerials and parts settling somewhat, personnel-related costs are still soaring due in part to thespace. However, I believe that there will be no major impact on Japan’s overall office market andadoption of rules capping overtime work in the construction industry. We must consider the possi-

that most companies will return to office-centric workstyles. Actually, because office demand peak-bility that construction costs will stay high overall. Because construction is already under way, theed in 2019, we are now seeing a solid trend of companies that were unable to secure an office inimpact of rising construction costs will be minimal for the Yaesu Project and most of the properties

their ideal location in the past seizing on the current opportunity to upgrade while integrating andscheduled for sale during the Plan. In addition, because we reined in expenses to counter the rise

expanding their office space. The massive supply of office space in 2023 has given rise to con-in construction costs, I believe we can ensure appropriate profitability.

cerns that some areas could see another rise in vacancies in existing buildings in less attractive

At issue going forward is land that has already been secured and ensuring the profitability oflocations. However, given that our office portfolio is highly competitive and includes large-scale

projects with agreements under which we bear the construction costs. From fiscal 2025, while rising

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

11

Message from the CEO

construction costs will have some effect on property sales to investors and condominium residenc-

In April 2022, we identified seven priority issues related to human rights and began expanding

es, we plan to fully start construction of other large-scale redevelopment projects. Most redevelop-

human rights assessments when entering new businesses overseas. In the supply chain, we havement projects are promoted in collaboration with groups of landowners, so it can be difficult tomade steady progress, such as attaching the Group’s sustainable procurement standards to con-control when construction will begin. Aiming to achieve the profit growth outlined in the long-term

struction subcontracting agreements, encouraging compliance, and conducting surveys to monitor

vision, we need to regularly hold deeper discussions on what kind of strategies we should create

compliance status.

for the entire Company.

Regarding governance, I feel that discussions are frank regardless of the meeting type, whether

We are also paying close attention to the effects of interest rate hikes on business results.

they be the Company’s Board of Directors meetings or management meetings. External directors

Regarding fund procurement, we do not have any significant concerns because we have alreadyhave brought a fresh perspective, pointing out internal practices that have become habitual. Due tobeen acquiring long-term, fixed-rate borrowings in consideration of the inherent nature of our busi-

the nature of the real estate business, the amount of money involved in each investment project isness. However, in the Residential Business, performance is directly affected by customer’s ability toever larger. As a result, Board of Directors meetings were taking longer and longer to discuss eachpurchase as well as the effects of the cap rate on real estate sales. Currently, long-term housing

project. By further expanding the scope granted to managing officers for decision making regard-

loan interest rates remain low and demand is holding steady. In my many years of experience, evening investment projects, we have enhanced the effectiveness of the Board of Directors andif cap rates rise for logical reasons, when it comes to actual sales of highly competitive properties,

expanded medium- to long-term discussions, including those concerning the long-term vision, thetransactions often take place at much higher levels, even in real estate sales. While keeping aPlan, and our business portfolio. In the effectiveness evaluation survey, we received feedback thatwatchful eye on the situation, we will continue to make rational decisions based on our experience

we should increase the number of people with corporate management experience and that weto date and the local trade activity.

need DX experts. We take this feedback seriously.
Diverse personnel are needed to support sustainable management, but I do not think our top
management can make important decisions without a proper understanding of the inner workings

5

Focusing on initiatives aimed atsustainable managementof the real estate industry. Experience is crucial when making final decisions on whether to approveor reject various projects. Because there are non-logical aspects to the real estate business, namely personal relationships, I feel it is important to be able to make forecasts supported by experience

Because the real estate business significantly affects the environment and society as a whole, we

and draw in good people. I believe that it’s still vital to take advantage of these possibilities bymust address stakeholder demands head on to ensure the Company remains in operation.

building experience through everyday actions.

Although addressing environmental concerns could lead to higher costs, I feel that it is important toapproach efforts to achieve the SDGs as opportunities as well as to consider the nature of thevalue we provide to customers and how our efforts are evaluated. Recognizing that it is imperative
to intentionally set ambitious goals and have all employees work diligently together to achieve
those goals, in fiscal 2021 we set medium- to long-term targets aimed at reducing greenhouse gas

6

To be a good company for all stakeholders

emissions and rolled out various initiatives. In February 2023, we further accelerated measures to

In the long-term vision, we declared our aim to be a good company for all stakeholders.

achieve our medium- to long-term targets, for example, expanding the scope of properties covered

Realistically, being the best company for all stakeholders simultaneously and at all times is difficult.

and moving up the fiscal years we had originally set for achieving those targets. In the environmen-

Moreover, because enhancing medium- to long-term corporate value is linked to being a goodtal field, while we may not have yet rolled out many measures unique to the Company, we havecompany for all stakeholders, we cannot limit our thinking to only the present. Basically, we mustspearheaded such initiatives as installing solar panels on the roofs of developed logistics properties

secure ongoing growth over the long-term in order to earn a solid reputation rooted in that proba-

to supply power for in-house use with surplus power distributed to other Company facilities. Goingbility and expectations for the future. Going forward, the Tokyo Tatemono Group will continue mov-forward, we will thoroughly discuss what the Company can and should do while striving to tackle

ing full-steam ahead to become a next-generation developer. Moving forward, the Group asks forchallenges in various fields.

your continued understanding and support.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

12

Evolution of Medium-Term Business Plans
FY2012–2014
Operating profit (Billion yen)

FY2015–2019
Business profit (Billion yen)Debt-equity ratio (times)

FY2020–2024

ROE (%)

33.2

5.3

10.0

5.6

4.4

30.8
2.3
FY2012

30.5
2.6

29.3
1.7
FY2013

FY201434.4
2.3
FY2015

6.4

44.7

36.3

2.4

2.3
FY2016FY2017

8.3

8.2

7.9

6.8

46.7
2.5

52.4

49.6 49.8

75.0

64.4 66.3

58.7
47.9

2.5
2.5

FY20188.7

FY2019FY20202.3

2.2

FY2021

FY2022

FY2024 (Target)

2012–2014 Medium-Term Business Plan

2015–2019 Medium-Term Business Plan

Quantitative Targets

Results

Quantitative Targets

Results

Profit Target

Operating profit

35.0 billion yen

30.5 billion yen

50.0 billion yen

52.4 billion yen

Capital Efficiency

ROE: 8–10%

Debt-equity ratio

3 times

2.6 times

Targets for Financial
Indicators

Results

Financial
Indicators

Debt-equity ratio: 2.4 times
Interest-bearing debt / EBITDA multiple: Approx. 12 times

Debt-equity ratio

3 times

2.5 times

Interest-bearing debt/
EBITDA multiple

13 times

12.6 times

Reference Figures

Consolidated operating profit: 70 billion yen
Profit attributable to owners of parent: 45 billion yen
EPS: 215 yen

Targets Achieved
In accordance with our desired future direction for the Group, thismedium-term business plan was positioned as a stage for reinforcing
the business foundation. The plan called for the Company’s transformation centered on the strategically focused structural realignmentand optimization of the value chain. Our aim was to thoroughly
strengthen earnings power and the Group’s financial position.
We implemented various measures, including selling some business units and reorganizing the special purpose company structure
for large-scale projects. In addition, by keeping interest-bearing debt
down and expanding the equity base, we reinforced our financial
position beyond the plan’s initial targets.
Issues Remaining
Although we built a sound financial base, we failed to achieve target profit
levels, and the plan concluded with profitability as an ongoing issue.
We recognized the need to boost profitability by building a business portfolio with high growth potential, which would enable us toachieve sustainable growth over the longer term. We incorporated thisrecognition into the next medium-term plan.

Consolidated operating profit

Targets Achieved
The objective of this medium-term business plan was to strengthen
earnings power and build a business portfolio with high growth potential.
To achieve this, the plan called for us to provide a range of high-quality
services to enhance customer satisfaction, strategically focus on fields
and business domains where we could take full advantage of theGroup’s unique expertise and competitive strengths, strengthen the value
chain, and deliver value through organic collaboration between a variety ofbusiness units.
We achieved profit growth in excess of the initial target and practiced amore disciplined financial management approach. At the same time, in
addition to pursuing consistent growth in each business, we took various
initiatives for future growth, such as investing in hotels and logistics properties
and other new asset types and expanding the stock of quality real estate.
Issues Remaining
We were successful in strengthening earnings power and maintaining asound financial position. However, the need for actions that would ensuresustainable growth became more apparent as we faced shifts in the business environment, including mounting competition between international
cities, increasingly diverse lifestyles, and rapid advances in digital technology, coupled with the pressing issue of sound ESG management.

2020–2024 Medium-Term Business Plan
Consolidated business profit*: 75 billion yen* Consolidated business profit = consolidated operating profit + share of
profit (loss) of entities accounted for using equity method

Positioning
In February 2020, to accomplish the Group’s long-term vision looking
ahead to 2030, we formulated a medium-term business plan covering
the five years from fiscal 2020 to 2024. We are undertaking five key
strategies and the evolution of ESG management with the aim ofachieving our stated targets.

Our key strategies

1 Promotion of large-scale redevelopment
2 Further strengthening of for-sale condominium business
3 Expansion of property sales to investors
4 Strengthening of brokerage, fund, and parking businesses
5 Growth in overseas business
Evolution of ESG Management

Target for 2030 and Long-Term Vision

Becominga Next-Generation
Developer• Consolidated business profit of
120 billion yen• Contribution to achieving the SDGs

Long-Term Vision and Materiality p. 36

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

13

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Progress on the Medium-Term Business Plan (2020–2024)

Expansion of property sales to investors

Here we explain our progress thus far in implementing the five key strategies of the current

Regarding property sales to investors, which are a driver of profit growth, buyers’ appetite for spending has stayed firm

Medium-Term Business Plan, which began in 2020.

in the real estate sales market, and cap rate levels in real estate trade have remained at a low level. Amid these market
conditions, we have selected appropriate assets and sold properties at prices above initial projections while maintaining
a balance between income from leasing buildings and income due to progress in sales of condominiums. In addition,

Promotion of large-scale redevelopment

we are carefully selecting investments, especially logistics properties, and steadily increasing our real estate stock.

Regarding large-scale redevelopment projects currently under way, although some have seen their schedules
delayed compared with the forecasts made when the current business plan was initially formulated, steady progress has been made as shown in the table below.
We adeptly responded to accelerated changes in workstyles and lifestyles due to the COVID-19 pandemic andWe will continue working hard to ensure profitability with a focus on cost management while taking into account therisk of rising construction costs.
Commercial Properties Business p. 24; Residential Business p. 28; Asset Service Business p. 32

tried out various approaches to product planning to realize facilities that will be customers’ first choice into the

Balance of real estate for sale

future. We also aim to enhance the value of the overall area in part through initiatives that create new added value.

Commercial properties
Asset service(Billion yen)

Special Feature p.18; Commercial Properties Business p. 24

152.8
Yaesu Project

Gofukubashi Project

District A: Jan. 2023, Approval of rights conversion plan
District B: Oct. 2021, Start of new construction
Made steady progress toward the completion of construction in fiscal 2025

205.2

Gross profit trends in property sales to investors

For-rent condominiums
Other

206.5

209.6

(Billion yen)

255.6

56.2
41.7
157.6

FY2018FY2019FY2020

FY2021

FY20224.0

6.4

FY2018FY2019

17.7

19.8

16.3

FY2020

FY2021

FY2022

Nov. 2021, Establishment of urban redevelopment consortium
Began demolition in preparation for the completion of a tower wing in fiscal 2029

Kyobashi 3-Chome ProjectJan. 2023, Determination of urban development plan

Shibuya 2-Chome ProjectJan. 2023, Approval of establishment of urban redevelopment consortium

Strengthening of brokerage, fund, and parking businesses
In the Brokerage Business, business performance has remained steady against the backdrop of a robust real

Although we need to focus on business environment issues, such as rising construction costs and concerns overestate trade market. The Company focused on strengthening relationships with customers and securing repeat

demand for office space, we will continue to appropriately control our business to steadily expand leasing profit.

business from the Company’s existing development properties.
In the Fund Business, we are steadily expanding the size of assets managed by private REITS and funds as wellFurther strengthening of for-sale condominium businessas Japan Prime Realty Investment Corporation, for which a Group company conducts asset management.
The Parking Business was significantly impacted by the COVID-19 pandemic, but capacity utilization recovered

Sales of condominiums have remained strong against the backdrop of several trends: a continuing low

as occupancy returned to normal from the second half of 2022. As a result of pursuing steady business expansion

interest rate environment, an increase in dual-earner households, and a shift toward more affluent lifestyles.

while working to strengthen profitability and our competitive advantage, the number of parking spaces rose toSince the COVID-19 pandemic, inventories of completed properties have remained low amid steady prop-

around 80,000 as of December 2022.

erty sales in suburban areas and favorable locations in highly convenient urban centers.
Over the course of the current Medium-Term Business Plan, we have been able to sell properties at higher
than anticipated prices. The gross profit margin on condominium sales in fiscal 2022 reached a very high 33.3%.
Although the land acquisition environment remains highly competitive,

Asset Service Business p. 32; Fund Business p. 34

Growth in overseas business

we have steadily built up our land bank by proactively working on recon-

In the Overseas Business, we revised business plans for various projects following a temporary suspension of projects

struction, redevelopment and other projects that leverage the Company’sin Indonesia due to such circumstances as the effects of the COVID-19 pandemic and a suspension of all projects in

know-how. Because we have also made progress on sales, we expect the

Myanmar due to the declaration of a state of emergency. Mainly as a result of these revisions, we recorded a share ofgross profit margin to remain high into 2023 and 2024.

loss of entities accounted for using the equity method in fiscal 2021. Investment in new projects shrank more than
expected as a result of the prolonged period during which overseas travel was very difficult.

While paying attention to rising construction costs and the risk of

We held discussions regarding policies on initiatives considering the above factors and decided to continue under-

decline in customers’ intent to purchase residences amid rising loan interest rates, we will continue ensuring appropriate profitability going forward
by carefully selecting investments.
Residential Business p. 28

Brillia City Nishi Waseda(recorded in 2022)

taking the overseas business to diversify the Company’s earnings base predicated on improving risk management processes and thoroughly strengthening monitoring. We will continue searching for business opportunities, especially in
China, Singapore, and Thailand, where we have a solid track record, but also in other countries.
Overseas Business p. 34

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

14

Progress on the Medium-Term Business Plan (2020–2024)

Tokyo Tatemono manages its business portfolio in three main categories in line

Image of Change in Composition of Business Profit (as of the formulation of the current Medium-Term Business Plan)

with their earnings characteristics: leasing, which provides highly stable profits;

Leasing

property sales, which possesses high capital efficiency; and services, which do

Property sales

not involve large investments. When we initially formulated the current Medium-

Services

Term Business Plan, we were aiming for consolidated business profit of 75 billion
yen in fiscal 2024, assuming an increase in leasing revenue from offices in opera-

120.0 billion yen
20%

75.0 billion yen
51.6 billion yen

20%

30%

40%

tion and steady growth profit from services, mainly the Parking Business, with themain growth driver being profit from property sales, especially sales of condominiums and property sales to investors.
However, in the leasing sector, the building leasing business has underper-

10%

30%
50%

60%

40%

2019

2024 (forecast)

2030 (forecast)

Property sales will expand until
2024, and leasing will expand from2025. Services will continue to
steadily grow, enabling us toachieve a well-balanced profit
composition with an awareness ofcapital efficiency.

Note: The percentages shown in the graph represent the approximate composition ratio

formed compared with forecasts due to a dip in demand caused by vast changes
in the external environment. In addition, growth has slowed more than expected in

Project completions in 2025
and beyond drive major expansion

Promotion of large-scale redevelopment

some businesses, such as the overseas business. On the other hand, in the

Leasing

property sales sector, we have seen higher than expected profits from sales ofWell-balanced profit
structure focused onleasing profit andmindful ofcapital efficiency

Growth of leasing revenue from active properties

condominiums and sales of property to investors against a backdrop of a strong
Property sales

market. And, while profit composition in fiscal 2024 may differ somewhat frominitial forecasts, by leveraging the characteristics of risks and opportunities in

Expansion primarily through renovation at held properties

Services

each business to supplement results, we aim to achieve our targets.

Ongoing profit generation

Steady growth

Change in Business Profit and Profit

Period of the current medium-term business plan (2020–2024)(Billion yen)

66.3
Profit attributable to owners of parent
Breakdown of business profit
Commercial Properties Business

51.6
6.4
15.8

49.8

47.9

11.4

11.3
7.1

17.0

23.3

71.0

75.0

14.0

17.0

23.0

18.0

Residential Business
Other—Asset Service—OtherElimination and corporate

37.5

29.7

-8.2

40.8

31.7

34.9

-4.8
-9.1

-9.5
FY2019(Results)

44.8

FY2020(Results)• Leasing of buildings

FY2021(Results)

Residential Business• Although buildings in operation will decline as we promote redevelopment projects, we assume leasing profit will hold steady because we

expect internal growth due to the upward revision of leasing fees.

43.0

-9.6

Image of Profit Growth Image When Formulating the Medium-Term Business Plan (As of February 2020)
Commercial Property Business

41.2

44.5

44.5

-10.5
FY2022(Results)

FY2023(Forecast)

49.0

45.0

-9.0
FY2024
Forecast when the plan was formulated

Evolution after the Medium-Term Business Plan Began• Demand for office buildings will dip due in part to the widespread adoption of new workstyles, and the pace of upward revision in leasing

fees will slow. External growth will also perform below expectations.

• We expect to record stable profits as we continuously seize development opportunities.

• Gross margin will perform better than expected as sales prices rise above initial forecasts. We will also sufficiently secure our land bank.

Other• We expect growth in the brokerage, fund, parking, and overseas businesses.

• Due in part to effects of the pandemic, growth decelerated more than expected, mainly in the overseas and parking businesses.

Property sales to investors• We expect profit growth due to expeditious property sales and ongoing pursuit of development opportunities.

• Condominiums for sale

• Although progress on investments has been delayed due to intensifying competition for property acquisitions, we will continue to record

sales profits higher than forecast against the backdrop of a strong real estate trade market.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

15

Message from the CFO

We will continue to meet the expectations of shareholders and investors
while focusing on growth investmentsfrom a long-term perspective

Q2

What is your approach to financial
soundness and financing?

We have steadily remained within our range of expectations vis-à-vis
our financial standing and are on course to achieve the fiscal 2024
figures set out in our financial policy under the current medium-term
plan. Thanks to our strong financial performance up to fiscal 2022,
we have accumulated owners’ equity and, as of December 31, 2022,
achieved a debt-to-equity ratio of 2.2 times and a debt-to-EBITDA

Akira Izumi

ratio of 11.1 times. In addition, we have maintained a long-term credit

Representative Director
Senior Managing Executive
Officer & Chief Financial Officer

rating of A from external organizations and will continue to fully ensure
financial soundness.
Right now, with interest rates rising globally and inflation risingdomestically, there is growing concern in Japan regarding the economic impact. Although we think the possibility of a rapid hike indiscussions regarding our policies going forward and come to theinterest rates is low, we are taking thorough precautions against justconclusion that we should diversify our earnings base while keeping

such a risk. So, should a temporary rise in interest rates occur,

an eye out for a contraction in the domestic market. We will continue

because over 90% of our borrowings and bonds—which are central

working hard overseas with the caveat that any project we undertaketo financing—are long-term and fixed-rate, we know that the impact

will be carefully selected, with those in emerging countries subject toon our business performance and financial standing would be limited.

In fiscal 2022, overall business results were very good with building

due consideration of country and geopolitical risks. Aiming to expand

Going forward, we expect to steadily accumulate owner’s equity, andleasing remaining strong and sales of condominiums and properties

revenues from the current medium-term plan forward, we strive tofinancing will not be a big issue because we have built and maintainto investors holding firm.

gain a foothold for expanding business in not only countries we havestrong relationships with financial institutions, spread out our financ-already entered but new ones as well.

ers, and diversified our financing, including ESG financing.

Q1

Please share your assessment of
FY2022 business performance and theprogress made in the three years of themedium-term business plan.

With regard to the current medium-term plan, which wasannounced in February 2020, our initial assumptions of the external

On the other hand, property sales to investors and sales of

In addition, regarding the impact of rising interest rates, we haveenvironment ended up being completely off, with the world impacted

condominiums have become stronger as growth drivers and out-

been alerted to the fact that we need to revise the hurdle rates offirst by the global COVID-19 pandemic and then the conflict inperformed our forecasts, while building leasing has held firm due

investments given the rising cost of capital. We include a rather sub-Ukraine. Nevertheless, we moved to steadily implement the plan’s

to our competitive portfolio. Overall, businesses that have done

stantial buffer for financing in terms of our internal interest rates forkey strategies. We strove to expand business to meet changing cus-

well have compensated for businesses that underperformed, andeach project, which are higher than the actual funding interest rates. It

tomer needs, and, as a result, our overall business performance

I can laud the fact that this demonstrates our resilience in theis difficult to imagine that a rise in interest rates within expected

remained strong. However, business did not expand as much as

face of environmental changes.

bounds would exceed our internal interest rates, so we believe wewill be able to continue sufficiently ensure profitability with the current

anticipated, and we must put what we have learned into practice

Going forward, although we will need to closely monitor such mat-moving forward. The Overseas Business was initially expected toters as trends in construction costs and interest rates, sales of prop-

expand, but we have refrained from stepping up investment in part

erties to investors and sales of condominiums are expected to remain

We will continue working hard to manage our finances in adue to having recorded a loss in fiscal 2021 attributable to politicalstrong, buoyed by solid building rents. This, along with an anticipated

way that ensures financial soundness and investment growth

upheaval in emerging countries and the protracted period during

recovery in the Parking Business, makes it highly likely we will be able

while accurately responding to risks and changes in financial andwhich overseas travel was very difficult. We have held many internal

to achieve the current medium-term plan’s fiscal 2024 profit targets.

capital markets.

hurdle rate.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

16

Message from the CFO

Can you tell us your current assessment of and the issues regarding thebusiness portfolio strategies set out inthe long-term vision?

Q3

expect to complete around 2030. All of these properties are expected to have very high value in ideal downtown locations and will significantly help expand our highly stable leasing profit margins. We can
expect a further increase in value due in part to area management.
However, the business period of these properties is long, and theIn our long-term vision and medium-term management plan, we cat-

profit margin is low due to their being in prime locations, which will

egorize our diverse businesses into three categories in accordance

negatively affect ROA. Therefore, to maintain balance and increase

with their earnings characteristics: leasing, which has highly stable

capital efficiency for the business overall, it will be important for us torevenues; property sales, which have high profitability and capital effi-

adhere to our forecasts and expand property sales to investors andciency; and services, which directly contribute to improved capitalsales of condominiums, which have shorter business periods andefficiency through leaner funding. Over the medium to long term, we

help increase ROA. Buoyed by our excellent assets, which stably

aim to maintain a balanced profit composition with an awareness ofgenerate leasing income over the long term, we will expand short-capital efficiency.

term turnover projects, which have high capital efficiency despite

Expanding the leasing sector will center on multiple large-scale
mixed-use redevelopments, including the Yaesu Project, which webeing volatile, and continue growing through these two means.
Although this serves as the base for our business portfolio strategies,
we have made steady progress on large-scale redevelopments andmaintained strong property sales to investors and sales of condo-

Change in Composition of Business Profit
Property sales

LeasingService120.0 billion yen
20%

75.0 billion yen
51.6 billion yen
30%

20%
10%

50%

60%

40%

2019

2024 (forecast)

2030 (forecast)Investment Plans and Results in the Medium-Term Management
Plan (2020–2024)
Unit: Billion yen

Five-year
plan

2020
results2021
results2022
results

What are the strengths of and strategies
for human capital?

We recognize that human capital is the source of strength thatwith our forecasts.

enables the realization of the Group’s value creation andharsh. Because we are careful in our selection of investments and

40%

Q4

miniums. In my judgement, we are currently making progress in line
An ongoing issue is that the land acquisition environment remains

30%

thorough studies, including on reducing cross-shareholdings.

sustainable growth as well as one of its most important management foundations.

avoid over-priced acquisitions, we have an increasing number of proj-

The business of a developer is structured around the concept ofects that need significant time to commercialize despite securing the

maximizing the value of each property and requires the creation of

expected number of short-term turnover investments. Although wevalue in harmony and collaboration with various related parties.

will maintain our highly selective investment policy while proactively

Success largely depends on the capabilities of employees working as

taking on new business opportunities, going forward we will continue

individuals and in teams. Luckily, the Company contains many indi-taking various measures to shorten business periods.

viduals who sincerely engage with stakeholders and are able to build

In addition, we outline “management with an awareness of capitalsolid relationships founded in trust, tackle challenges and create
value. These personnel are our greatest strength in establishing ourcompetitive advantage.

1,400.0

189.1

128.9

191.0

efficiency” in the current medium-term plan, signaling our aim to opti-

Investment in large-scale
redevelopment

230.0

13.8

0

11.3

mize our business portfolio and asset composition. To this end, we

Investment in for-sale condominium projects

430.0

75.8

sold the Elderly Facility Operation Business in fiscal 2020 and thebusiness scope and creating value as targeted in our long-term vision

Gross investment

64.4

46.1

Speaking strategically, because we will continue expanding ourInvestment in property sales to investors

550.0

63.6

57.9

91.1

Child Care Business in fiscal 2023. We continually revise our portfolio

Investment in the Overseas Business

70.0

1.6

3.4

0.7

of non-current assets, and, regarding the realization of profit by sellingand medium-term plan, we will expand our hiring of new graduates

Other*

120.0

45.7

21.5

12.1

non-current assets, we will continue studying the issue while focusing

and mid-career personnel, promote the advancement of women,

Recovered

900.0

120.6

121.3

112.7

Net investment

500.0

68.5

7.6

78.3

on profit plans for the current medium-term plan and thereafter.

and expand diversity in part by securing specialized personnel,

Regarding initiatives to optimize our business portfolio and asset com-

including DX personnel. In addition, because we strive to maximize

position, we will continue promoting such initiatives and conducting

personnel value, we are expanding training programs, upgrading* Includes capital and other expenditures and provisions for the acquisition of seed landbuildings and income-producing real estate for large-scale redevelopment.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

17

Message from the CFO

environments to enable flexible workstyles and enhance productivity,

more than six times to 65 yen in fiscal 2022, reflecting a record ofand promoting health management. Furthermore, to prompt individu-

nine years of maintaining progressive dividends. In addition, underfurther stimulate the expectations of shareholders and investors.

al and organizational engagement, we are focusing on stimulatinga policy of maintaining the dividend payout ratio at 30% or higher

communication between management and employees and strength-

during the period of the current medium-term management plan,*We implemented a one-for-two common share reverse stock split on July 1, 2015. The
dividends in 2013 were calculated using the standard after the reverse stock split.

ening engagement.

the ratio was 31.5% in fiscal 2022. Since the start of the current

As mentioned previously, the strength of the Company’s personnel

medium-term plan, we have raised it every fiscal year. We restart-

shareholder return policies as we intend to continue working hard to

Q6

Finally, what is your message to stakeholders?

is mainly attributable to its efforts to nurture them in accordance withed in-person IR efforts overseas last year, and, through my per-the foundation laid by the Company’s unique corporate culture, such

sonal conversations with many investors, I came to a keen

As a developer, the Company continually generates new economic

as the shared values we have cultivated throughout our long history,

realization of their desire for stronger returns. Accordingly, we

and social value through urban development while controlling various

the connections between and sense of unity shared by management

have further raised the dividend forecast for this year to 33.8%.

risks. The value that we have created over many years is a tremen-

and employees, and a good amount of transparency. From this per-Taking a long-term perspective as we move forward, while priori-

dous accomplishment, encompassing ripple effects and stock

spective, as we strategically accelerate the increase in the number oftizing growth investments that help enhance corporate value, weeffects, and has greatly contributed to local communities and society

employees and the expansion in diversity, we will continue promoting

will strive to raise our dividend level with an awareness of the needat large. Through our operations, we strategically promote sales ofhuman capital management with an awareness of leveraging diversity

to maintain progressive dividends.

non-current assets and the expansion of business involving short-while preserving the best aspects of our corporate culture.

We recently received a request from the Tokyo Stock Exchange

term turnover projects while continually expanding stable prime

regarding management and taking action in a manner that is aware

assets. We will appropriately control our balance sheet and optimizeof the cost of capital and the share price. In the current medium-term

our business portfolio when needed and will pursue capital efficiency

plan, we set a target for management aware of capital efficiency withand growth while ensuring financial soundness. Until 2030, we

the aim of achieving an ROE of between 8% and 10% by fiscal 2024.

expect to expand our stable leasing earnings base by regularly com-

We unveiled a policy to achieve this target by raising ROA andpleting large-scale projects already in our abundant pipeline.

appropriately controlling the debt-to-equity ratio. Through the steady

Underpinned by this base, we also expect to be able to further

Regarding shareholder returns, looking back on past trends, com-

implementation of this policy, we achieved an ROE of 10% in fiscal

expand our short-term turnover projects backed by a foundation ofpared with 10 yen* in fiscal 2013, dividends per share have increased

2022, well above the cost of shareholders’ equity. On the otherorganizational capabilities and human capital, which we will continual-

hand, we are concerned about our persistently inexpensive sharely bolster.

Q5

Please tell me about your shareholder
returns policy and your policy for ensuring that the Company’s corporate value
is appropriately evaluated by the market.

price, similar to that of all other developers. We realize that toRegarding the outlook for Tokyo Tatemono as it makes steadyincrease PBR, we will need to increase ROE and foster stronger

progress toward achieving its current medium-term management

trust in and anticipation for the Company’s outlook, including forplan and long-term vision, we hope shareholders and investors

shareholder returns.

broadly acknowledge its investment value, including from the SDG

Going forward, we will work to increase trust from the market by

and ESG perspectives. As we make major strides toward increasing

demonstrating our resilience in the face of environmental changes

our corporate value going forward, we will continue working hard toand steadily generating profit. We will also foster anticipation byincrease the expectations of shareholders and investors regarding thedemonstrating the likelihood of achieving sustainable profit growth

Company’s outlook by regularly holding more detailed briefings andand enhancing shareholder returns through our track record anddialogues regarding key strategies, progress made in strengthening

strategies. Through these efforts, we will continue striving to enhance

governance, future strategies, and other topics.

shareholders’ value.
Under the next medium-term management plan, we will reconsider
the balance between investment and returns and announce new

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

18

Special Feature: Urban Redevelopment Project for Yaesu 1-Chome East Area in Front of Tokyo Station (Districts A and B)
Urban Development That Helps Strengthen Tokyo’s CompetitivenessPromoting Large-Scale Redevelopment—a Field of Great Social SignificanceThe Attractiveness and Potential of the Yaesu-Nihonbashi-Kyobashi (YNK) Area

Under its long-term 2030 vision of becoming a next-generation developer, Tokyo Tatemono aims to achieve an

Always serving on the front lines of evolution in the ever-changing Tokyo landscape, the YNK area is a place where

overarching balance between solving social issues and growing as a company. The promotion of large-scaletradition and leading-edge technology come together. While the area has unparalleled access to transportation as

redevelopment is one of the key strategies for this goal.

well as the potential to be a top business destination, it also retains a traditional culture that encourages innovation.

Current large-scale redevelopment projects include undertakings in Shibuya Ward, Minato Ward, and Chuo
Ward, especially the Yaesu-Nihonbashi-Kyobashi (YNK)*1 area in front of Tokyo Station, which we have posi-• Incredibly convenient transportation
With a high concentration of train and subway stations within walking distance of the entire area, YNKprovides excellent accessibility to such prime locations as international airports, other major hubs within
Tokyo, and regional cities.

tioned as a priority area. By around 2030, plans call for the completion of construction on projects with a grossusable area* owned by the Company equivalent to around 320,000 m , and we expect the significant contribu2

2

tions these projects will generate to drive rapid growth in our leasing revenue.
*1 In addition to being an acronym for Yaesu, Nihonbashi, and Kyobashi, YNK (pronounced “ink”) also stands for “You Never Know!,” ourmessage for this area.
*2 Includes conference facilities, hotels, retail facilities, and a variety of non-office usable areas• Tradition and modernity coexist
Since the Edo period, traditional values have persisted
in the area, with festivals, food, art, and crafts ensuring
a thriving culture. And, it is not just traditional culture
and history that are alive and well, the area offers anabundance of new experiences that draw crowds.

Gofukubashi
Project
FY2025Completion of the Yaesu Project p. 18–20

FY2029Completion of the Gofukubashi Project p. 25
Completion of the Kyobashi 3-chome Project p. 25
Completion of the Shibuya 2-chome Project p. 26

320,000 m

2

of usable area
2030 onward

Yaesu Project

Creating aroundYNK area*T he Five Routes were established by the Shogunate in 1604
to facilitate transportation and trade.

All projects are currently in operation, including
other projects under way in Minato Ward.

Kyobashi 3-chome
Project

Not only does the redevelopment business contribute to the Company’s profitability, it possesses an
outsized social significance in that it enables us touse our business help solve social issues, enhancing

Urban development that helps solve social issues
Helping to preemptively solve the issues of future generations
and broader society while respecting local history and culture

the attractiveness of the area being redeveloped
even further.
Increasing the overall attractiveness of an area
leads, in turn, to higher value for our entire portfolio,
as the gain in value spills over from newly completed
redevelopments to enhance the value of our nearby

Helping to realize a sustainable society through measuresthat include efforts to reduce environmental impact
and strengthen countermeasures against natural disasters
Fostering a robust community and the interaction ofdiverse people by creating lively spaces

existing buildings. In this way, we aim to strengthen
the competitiveness of the city and the Company.

Creating new value by collaborating with diverse partners
and utilizing leading-edge technologies• Diversity dating back to the Edo period
The lasting impact of this vibrant area on Japan islargely due to its having served as the starting point of
the country’s Five Routes,* making it a natural hub forthe diverse array of people that congregate there eventoday. Reflecting centuries of varied townsfolk, professionals, merchants, and others working and living in
the area, the land was divvied into smaller and smaller
segments.

Redevelopment promotedby Tokyo Tatemono

Redevelopment promoted byother companies

Buildings owned by Tokyo Tatemono

The Sanno Festival has been held
since the Edo period

Due in part to the fine segmentation of the district and its aging buildings, the YNK area was failing to achieve its
full potential. By 2030 many redevelopment projects, including a number undertaken by other companies, areslated for completion and the face of the streets will be significantly changed. To ensure the continuation of thevalues of tradition and diversity, the strengths of the area, we are collaborating with diverse partners as we work
hard to form an attractive area that blends tradition and leading-edge technology, work and life, the urban andrural, and the world and Tokyo.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

19

Special Feature: Urban Redevelopment Project for Yaesu 1-Chome East Area in Front of Tokyo Station (Districts A and B)

Creating Social Value in the Yaesu Project
Our flagship project, the Yaesu Project, encompasses our former headquarters building and is situated directly

Material Issues

What We Can Accomplish through the Yaesu Project

Strengthening Tokyo’s competitivenessas an international city•Upgrading urban infrastructure, including high-grade offices and large-scale bus terminals
connecting regional cities

across from Tokyo Station. The Company has worked earnestly for many years to reach agreements with themany parties relevant to this project and aims to complete construction in fiscal 2025.
In addition, we plan to take measures to address all the material issues the Group faces that we have identified from the perspective of social value creation while taking our pursuit of both “solving social issues” and•Enticing world-class, advanced medical facilities to locate here

achieving “growth as a company” to an even higher level.

Yaesu Project
Project nameUrban Redevelopment Project for Yaesu 1-Chome
East Area in Front of Tokyo Station (Districts A and B)
Location
Chuo Ward, Tokyo
New construction start year
District A: Plan for 2024
District B: 2021
Completion year
Plan for fiscal 2025
Total floor space
District A: approx. 12,000 m2
District B: approx. 225,000 m2
Building size
District A:
10 floors above ground, 2 floors below ground
District B:
51 floors above ground, 4 floor below ground
Main uses
Offices, stores, medical facilities, bus terminals, etc.

Contributing to a safe and secure society•Strengthening emergency preparedness and making the entire area barrier-freeCommunity building and revitalization•Providing various services to building users
and holding events that utilize theaters, conference halls, and outdoor spaces•Making the area more attractive by introducing area management

Wellbeing•Conducting office product planning under the theme of wellbeing and shifting the focus fromupgrading peripheral facilities
Offices and Initiatives That Realize Wellbeing p. 20

Addressing the diverse needs ofcustomers and society•Implementing initiatives that lead to sustainability, wellbeing, and the resolution ofsocial issues

Value co-creation and innovation•Building support environments and systems that make it easy for large corporations andstartups to implement proofs of concept (POC)

Social implementation of technology•Increasing efficiency and customer satisfaction by applying technology, such as smart buildings and automation (planned)

Revitalizing and utilizing realestate stock•Demolishing outdated existing buildings and working with landowners to redevelop and utilize
the land as real estate with high public benefit and market value

Promoting a decarbonized society•Introducing energy-saving equipment and supplying energy to the area from local building-based sources

Promoting a recycling-oriented society•Building an ecosystem aimed at realizing a sustainable city

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

20

Special Feature: Urban Redevelopment Project for Yaesu 1-Chome East Area in Front of Tokyo Station (Districts A and B)

Offices and Initiatives That Realize Wellbeing
In the modern era, the Company has increased emphasis on companies and indi-

Office Support Facilities That Realize Wellbeing

viduals contributing to society and forming social connections. And, it has become

To encourage communication among employees, we intend to create awidely recognized that individuals must be able to access a diverse range ofcommon floor that may be utilized by office tenants for a range of pur-

options in order to thrive, that is, maintain a state of wellbeing. Increasing the well-poses, including as a lunch spot, a cafe, workspaces of various kinds,

being of individuals contributes, in turn, to corporate growth and affects society as

and an event space.
Also, meals that emphasize flavor and nutritional balance, a widea whole. Aiming to create such a virtuous cycle, Tokyo Tatemono has establishedvariety of beverages, and a communal kitchen area in which"wellbeing, cyclical nature, and living" as the office concept for the Yaesu Project.

activities may be hosted will improve worker wellbeing.
Personnel strategy is a major management issue for many companies, and employee wellbeing is also a key
policy that has been positioned as a priority in growth strategies across Japan. The Company has engaged inextensive research and pored over case studies, confirming that higher employee wellbeing is correlated withjob retention and aids in the hiring of workers. In addition, through a survey,* we identified 20 wellbeingenhancement factors, analyzing the types of behavior and conditions that contribute to increased wellbeing.
Going forward, we plan to bolster wellbeing enhancement factors, study the specific services, functions, andspaces that improve workers’ wellbeing, and apply our findings to the Yaesu project and other urban develop-

Examples of Past Initiatives

ment endeavors.

We held “Beeat!! Yaesu,” a limited time event where, through the medi-*U nder the supervision of Yoshiki Ishikawa, a preventive medicine researcher, we conducted a survey of 10,000 businesspeople working in theTokyo metropolitan area and identified 20 factors that improve wellbeing, specifically, situations and behaviors that help improve wellbeing.

um of storytelling, a lens is focused on the future of food and envisioning the future of sustainable food in the Yaesu area. The event brought
together businesses and organizations from a variety of sectors, as well
as restaurants, chefs, universities, technical schools, government orga-

Social Wellbeing
Social Wellbeing

Personal
Wellbeing

Ensuring individuals are highly productive and thrive atwork to positively influence organizations and companies
and foster a vibrant environment

Personal Wellbeing

future of sustainable cuisine.(The event is now finished.)
Effects of wellbeing

Company Wellbeing
Company Wellbeing

nizations, end users, and others to establish the area as one for theContributing to society and providing value to society as awhole through organizational and corporate activities

Ensuring individuals’ mental and physical health is optimal by fulfilling physical and mental health needs andbuilding social connections

Initiatives to Achieve Wellbeing
As every person’s perception of wellbeing is unique, we believe a diverse approach is required. To that end, weare collaborating with a number of businesses to develop and research various services based on variables that

Factors That Improve Wellbeing

HEALTHLEARN

NATURE

SMILE

TRUST

Living healthfully

Learning new things

Feeling nature

Smiling

Fulfilling roles

IDENTITY

EXERCISE

Being yourself

Exercising appropriately

SENSES
Experiencing withthe five senses

CHAT

COOPERATION

Casual conversation

Helping each other andexpressing appreciationOWN WAY

IMPRESSION

MEAL

LINK

COMPASSION

Living at your own pace

Tugging on heart strings

Mindful food selection

Smooth connections

Acting kindly

ENTHUSIASMREFRESHTOGETHER

Changing your attitude

Meeting up with friends

have been identified as enhancing wellbeing. In an effort to create a workplace that enhances wellbeing, we are
currently looking into a variety of factors, including diet, sleep, and work environment.
By promoting wellbeing throughout the YNK area, centered on the Yaesu Project, we aim to enhance ourpresence while increasing the competitive advantages of the area and Company-owned properties.

COMFORT
Spending
comfortable time

Being enthusiastic

CONTRIBUTE
Contributing tocommunities and society

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

21

Special Feature:
Employee Roundtable

Maximizing Tokyo Tatemono’s
Unique Wellbeing
We would like to showcase the efforts and enthusiasm of
our employees, who are seriously committed to ensuring
the wellbeing of local people and companies through the
Yaesu Project.

Urban Development (1)Department

Urban Development (1)Department

Leasing & Consulting
Department

Toshikazu Sawa

Megumi Kawanami

Hisanori Matsunaga

What the Yaesu Project means toTokyo Tatemono

ditions and culture. At the same time, as a developer, I have to

Although the Urban Development Department is in charge ofthink about what we should do to further develop this area. In

overall product planning and business promotion, from the

my communications with local residents, I am careful to keep

project’s early stages we have incorporated multifaceted opin-

both of these perspectives in mind.

ions into product planning through collaborations with theWhat sort of attitude do you take toward theYaesu Project?

Matsunaga : I am in charge of tenant leasing, and one of theProperty Management Department, which specializes in facility

characteristics of the Yaesu area that I often hear about whenmanagement and operation, and the Leasing & Consulting

talking with our clients is its casual atmosphere. Even after the

Department, which is familiar with the needs of tenants.

Sawa : The Yaesu Project is not only our core project, but

redevelopment project is completed, many hope that the infor-

Among general real estate developers, the fact that we havealso a project that we have been working on together with themality and nostalgic downtown-like atmosphere of the area willboth property management and leasing functions in-house

local community for more than 20 years. As one of those in

be preserved. One of the area’s attractions is the wide range of

may be one of our strengths when it comes to the study ofcharge of development, I have been promoting the overall proj-

choices on offer, with a mix of upscale and more affordable

product planning.

ect and studying product planning while discussing and coor-

restaurants and both new and historic stores. We want to makeMatsunaga : Lessons learned from existing large-scale rede-dinating with various parties, including landowners, design andsure that this appeal comes across to our customers as well.

velopment projects that overcame the difficult times following

construction companies, and government agencies. Also, as a

Kawanami : The Yaesu Project is a mixed-use development

the 2008 Lehman Brothers collapse and the sense of crisis

Yaesu local myself, I am focused on carrying on the area’s tra-project that includes offices, retail facilities, and apartments.

that existed at that time have been passed down within theThe Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

22

Special Feature: Employee Roundtableproject, and we must carefully consider how we can differenti-

want to do so, we ultimately settled on wellbeing as the central

ate ourselves from the competition in the area.

concept. With this concept, we want to emphasize the physi-

Matsunaga : In terms of what makes our company unique, I

cal and mental health benefits that redound from working inthink that many of our employees are sharp and determined toand visiting the neighborhood of the buildings.

go beyond immediate considerations of economic rationality

Matsunaga : We also put much emphasis into the words

and efficiency and instead pursue what they see as essential.

“cyclical” and “living.” The concept of wellbeing is one that has“Wellbeing,” which is the Yaesu Project’s office concept, is notgradually spread throughout Japan, coming initially from over-just a tactic for selling offices, but a serious aspiration.

seas. It’s clear, however, that in Japan more emphasis is

Sawa : We have a system in place to ensure that anyone withplaced on the wellbeing of the group rather than the individual.

strong ideas about what they’d like to do can express their

Improving one’s wellbeing is difficult without taking into

opinions to management without hesitation and receive sup-account the wellbeing of those around them. In Japan, wellbe-

port on matters that represent true needs.

ing is seen as valuing harmony with one’s surroundings.
Therefore, the office concept of wellbeing, which was borncompany and are used when considering strategies. About ayear prior to the full-scale start of leasing for the Yaesu project,

The origins of wellbeing-based
office concept

opening of our presentation room, where we have already had
about 100 companies visit. So, we are off to a good start.

ing life," was created with the philosophy that one's own wellbeing will carry over and spread to those around them.
Kawanami : The “circulating” aspect of the concept empha-

we reinforced our direct sales force to ensure a solid connection with our clients. It has been about two months since thefrom the ideas of "what goes around, comes around" and "liv-

Could you explain the process and initiatives that
led up to the project’s office concept?

sizes that our wellbeing will not be confined to the borders of
our office, but will circulate throughout the building and thesurrounding area, while “living” implies that this is a wellbeing
experience that tenants can make full use of in their lives.

Sawa : We also have personnel transfers across our commer-

Sawa : The Yaesu project has been a long time in the making,cial properties and residential divisions. Building redevelop-with many discussions on various concepts and how to add

We have researched over 200 companies and conducted

ment projects are long-term projects, and it is rare to be invalue. However, since the Yaesu area encompasses placesinterviews and discussions with over 50 in order to create acharge of a single project until its completion, but in thethat vary widely in character—from nostalgic downtown spots

service that realizes this concept. Given the vague nature of

Residential Business, many projects are relatively short in dura-

to those representing traditional culture to others brimming

the concept of wellbeing, we have identified specific wellbeingtion, allowing personnel to experience entire projects. I am alsowith diversity—finding an overarching concept that could

metrics and incorporated 20 wellbeing enhancement factors

able to apply my past experience in business promotion in theaccommodate all this was difficult. From there, a forum wasinto our product planning. The very first step is to ascertain

residential division to my current line of work.

established for renewed discussion across departments onwhether one is in a state of wellbeing using the wellbeing met-

Kawanami : Along with the experience in residential develop-

ways to create product value. Through this forum it was decid-

rics, which is then followed by the second step of helping oth-ment that I gained in my previous position, I have applied dif-ed that the Company would lean toward solving the type ofers improve their wellbeing through various services linked toferentiation strategies in product planning for housing toissues corporations face and narrow down the office concept

the wellbeing-enhancement factors.

commercial properties. Unlike residential buildings, where theto focus on recruiting, retaining and fortifying human resourc-

Currently, we are conducting research and development on

end user is the average individual and there is always a large

es, an issue that all companies deal with. Although COVID-19

such services with various companies. For example, a number

number of competitors, the pros and cons of a commercial

served as a huge catalyst spurring a change in workstyles,of studies for the implementation of the Yaesu Project are cur-property are often determined by its location and rent.

once we had identified things possible for employees only if

rently under way, including an experiment that measures phys-

However, there are many competing properties in the Yaesu

they come into an office to work and thus reasons for them toical and psychological changes in response to relaxing stimuli,

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

23

Special Feature: Employee Roundtable

including the spraying of hot spring mist in indoor spaces andprovision of casual cups of tea that allow for hands-on experi-

Aiming for completion in FY2025

ence with Japanese tea culture as well as a service that offers
healthy, eco-friendly meals. Ideally, people should have theoption to choose from a variety of services as each person’s
wellbeing is just as unique as they are.

From a managerial perspective, what are yourambitions and expectations for the future?

Sawa : We are placing particular emphasis on food as it isMatsunaga : We are currently in the broad announcement

one of the key elements in achieving wellbeing. Food is aphase of the Yaesu Project with potential tenant companies.

much sought-after service in offices and it would be great to

Typically, presentations for large-scale developments havetake advantage of the diversity in Yaesu’s food culture, working

explanations that focus on the appeal of certain hardware

alongside the local community.

specifications. With the Yaesu Project, however, the company

The issue of CO2 emissions associated with food waste,is taking on the challenge of leasing in an unprecedented way

known as food loss or food waste, has also attracted attention

by focusing on getting people to resonate with the concept ofin recent years. In itself, a good meal is enough to boost one’s

wellbeing, something more difficult to convey.

sense of wellbeing, but if the meal has a story that takes the

Kawanami : The sales team’s commitment to the concept

global environment into consideration and if the ingredientsmovie was amazing. Their desire to make the film an

those who are actually utilizing the space.
Another thing to remember is that a redevelopment projectand cooking methods used are in consideration of the SDGs,

eye-opener for those in charge of comparing and contrastingis only as good as the landowner. As someone who assists in

we believe it will further increase the sense of wellbeing

various buildings was palpable.

redevelopment projects, I sincerely value the satisfaction of theenjoyed by those using the service when they find out how

Matsunaga : However, we also feel that it is difficult to fully

landowners when the project is completed, while also taking

they are contributing to and connecting with society.

communicate the concept of wellbeing to potential tenant

their wishes into consideration.

company management. It is imperative that we have them

Sawa : At a community opening event after the completion ofunderstand the positive effects of moving into one of the Yaesu

Nakano Central Park, which I had been involved in, I was told

Project’s buildings and how it is likely to lead to the growth ofby a number of passing local residents how much the area had

their company, going beyond mere leasing and consulting-

improved and how they were pleased to have a new place totype sales. It is often said that “happiness is contagious,”

hang out in Nakano. Those comments still linger in my mind.

and if the companies that occupy our buildings are “happy

Urban development projects greatly impact the community.

companies” in a state of wellbeing, it will spread to the entire

While everyone perceives them differently, it is naturally import-

office and the surrounding area. In my experience, such build-

ant to make a town’s locals and visitors feel that it has

ings have been well-loved over time, and have a low turnover

improved. The Yaesu Project will attract lively people, and thatof tenants. While location and rent are of course important, it

vibrancy will spread out and energize the entire city. From thewould be wonderful to have companies that share in our proj-

standpoint of a long-time business partner based in Yaesu, I

ect concept take up occupancy.

think this is what we should hope for in the future. I would like

Kawanami : I try to avoid being like the kind of development

to make this area a place of interest and a tourist destination

staff who are quick to sing their own praises. Even after thefor locals, people across the country and even people all overYaesu project is completed, we will continue to consider our

the world.

tenants’ needs, and will always focus on the evaluations ofThe Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

24

Commercial Properties Business
The Commercial Properties Business focuses mainly on the international city of Tokyo. Its business activities include urban development, the development andoperation of office buildings and retail facilities, facility management, building maintenance, and preservation and remodeling. We are working together as a groupto provide not only quality properties and facilities, but also a range of services that give office building users a sense of safety, security, and comfort.
Tokyo Tatemono is pursuing a wide range of development opportunities according to differing locations and area characteristics. Projects now under way
include medium-size office buildings, logistics properties, hotels, and retail facilities. After these projects start operations, we sell them to investors.
Main Business Categories

Related Material Issues

Long-term holdings
Development and Operation Business

Office buildings, large retail facilities,
etc.

Strengthening Tokyo’s competitiveness as
an international city

Contributing to a safe and secure society

Property sales to investors

Logistics properties, medium-scale officebuildings, retail facilities, and hotels

Addressing the diverse needs ofcustomers and society

Value co-creation and innovation

Services

Building management and operation,
construction, and cleaning

Wellbeing

Community building andrevitalization

Revitalizing and utilizing
real estate stock

Against a backdrop of tightening supply in the rental officemarket until fiscal 2019, our business results expanded,thanks especially to an increase in leasing profit frombuildings. From fiscal 2020, due in part to the effects of
the COVID-19 pandemic and the widespread adoption of
new workstyles, growth in leasing profit from buildings
slowed, but the overall real estate trade market remained
strong. Against this backdrop, our business performancestayed firm due mainly to an increase in logistics and retailfacility property sales to investors.
The average rent and occupancy rates of theCompany’s owned office buildings remained at high levels compared with the overall market, reflecting thestrong competitive advantages of their large scale andprime locations.

Operating Revenue / Business Profit

Proportion of Leasable Space by Standard Floor Space*

Proportion of Leasable Space by Building Age*

Proportion of Leasable Space by Location*

30 years and older

Other

1,000 tsubo (3,305 m2)
or moreUnder 299 tsubo (990 m )
2

17.8%

20.2%

Operating revenue

144.5
108.6

155.6

33.8

37.5

40.8

44.8

97.7

96.8

96.8

29,88230,58330,835 30,954

30,836

Diversifying needs for real estate utilization in line with
Opportunities such trends as a recovery in the e-commerce and inboundtourism markets
Expansion of needs related to real estate investment needs
and investment assets

41.2

Risks

Rising construction costs due to increasing resource prices
and labor costs
Decline in the real estate investment market due to risinginterest rates, etc.

FY2018 FY2019 FY2020 FY2021 FY2022

FY2018FY2019FY2020 FY2021

FY2022The Company’s Advantages•A wealth of know-how and experience in large-scale redevelopment andasset-type development

Under 10 years old

29.0%

27.1%

2.7%

20–29 years old

5.0%* The above proportions are for office buildings owned by Tokyo Tatemono as of March 31, 2023

•A track record of tenant leasing and urban development that increases
area value

Tokyo 3 eastern central words(Chiyoda, Chuo, andMinato wards)

18.7%
Other areas of theTokyo metropolitan
area

42.9%

10–19 years old

39.0%Tokyo 23 wards(excluding
5 central wardsof Tokyo)

23.9%•A highly competitive office building portfolio•A wide array of information sources, including financial institutions andexisting business partners, in addition to the Group network
Specific Initiatives under the Medium-Term Business Plan

Five central wardsof Tokyo•Expanding our future earnings base by promoting redevelopment projects inprime urban centers

50%+

20 years
40.2%

98.9

Intensifying competition between global cities and economic areas

Average age ofbuilding(Weighted average byleasable space)

500–999 tsubo(1,652–3,304 m2)

Operating Environment / Social Issues
There is a pressing need for increasingly sophisticated officespace in order to secure personnel and enhance productivity

Occupancy rate (%)

98.4

145.1

120.9

493,517 m2

21.8%

Average rent (Yen/tsubo)(Billion yen)

Leasable space

300–499 tsubo(991–1,651 m2)

Average Rent / Occupancy Rate

Business profit•Providing choice office space through product planning based on diversifying workstyles•Enhancing the attractiveness and competitiveness of the areas surrounding
the Company’s owned buildings by promoting area management

Tokyo 2 western central words(Shibuya and Shinjuku wards)

11.9%•Expeditious property sales attuned to the market and the effective utilizationof information sources to acquire properties for sale to investors

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

25

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Commercial Properties Business: Progress under the Medium-Term Business Plan and Strategies Going Forward
Otemachi
StationTokyo Station
Central Exit

We believe that regularly taking straightforward action based on the

etroTokyo M Linechi
Marunou

Corporate Philosophy “Trust beyond the era” will help us build trust with
Tokyo International
Forum

our customers and achieve an overarching balance between solving

Tokyo Metro
Hanzomon Line

JR Tokyo Stationsocial issues and sustainable growth as a company at a high level.

Tokyo Metro
Tozai LineWe will contribute to improving the competitiveness of our assets andpriority areas through value-added urban development by meticulously

Nishi-ginza Exit

JR Keiy

responding to the diverse and ever-changing needs of our clients.

Nishi-ginza JCT

Representative Director
Senior Managing Executive Officer
Division Director of Commercial Properties Division

Promotion of large-scale redevelopment■ Promoting Redevelopment in the Yaesu-Nihonbashi-Kyobashi Area
Tokyo Tatemono positions the Yaesu-Nihonbashi-Kyobashi (YNK) area in front of Tokyo Station as a key areaand has cultivated deep ties to this area since its founding.
The YNK area has highly convenient transportation and a high concentration of large companies. At the same

Yaesu ProjectSpecial Feature
pp. 18-20

Gofukubashi
Project

Mitsukoshimae
StationNihonbashi
Mitsukoshi
Main StoreTokyo Tatemono
Yaesu Building
NTA Nihonbashi
Building

Tokyo Tatemono
Yaesu Naka-dori
Building

Kyobashi
StationNihonbashi First Building
Tokyo Tatemono
Nihonbashi Building

Nihonbashi Station
MuseumTower
Kyobashi

Kyobashi YS
Building

Takaracho
StationNihonbashi
Takashimaya
S.C.

Showa dori Ave.

time, this an incredibly unique area where traditional culture coexists in prime office real estate, as evinced by thecontinued holding of the historical Sanno Festival.

Tekko Building

Nihonbashi South
Post Office

Kyobashi 3-chome
Project

Metropolitan Expressway Inner Circular RouteBank ofJapan

Tokiwabashi
Tower

Sousei Tatemono Building

Yaesu St.

Higashi-ginza JCT

KYOBASHIEDOGRANDkajibashi-doriUrban Development That Raises Area Value

Tokyo Tatemono
Kyobashi Building

Shangri-la
TokyoTokyo Tatemono
Yaesu Sakura-dori Building

TOKYO MIDTOWN
YAESU

TOKYO
SQUARE GARDEN

東京建物京橋ビル

DaimaruTokyo

Sotobori-dori Ave.

o LineKatsuhito Ozawa

Yaesu
Central Exit

Four Seasons HotelTokyo at Marunouchi

Toei Asakusa LineTokyo
Nihonbashi
Tower

Tokyo Metro
Ginza Line

COREDO
Nihonbashi

Nihonbashi Station

Redevelopment promotedby Tokyo Tatemono

Buildings owned
by Tokyo Tatemono

Note: Items indicated by white balloons on the map are initiatives to foster an innovation ecosystem among facilities owned by Tokyo Tatemono

p. 26

The Company is promoting multiple projects in this area to contributeto the development of Tokyo as an international city. We will continue
supplying highly competitive buildings through redevelopment
focused on reducing environmental impact and providing sought after
urban functions.
While redevelopment projects have huge social significance, theyalso require various interested parties to reach an agreement, making
them incredibly difficult and extending their schedules over the longterm. Because Tokyo Tatemono has long valued traditions and local
communities, we are able to build trusting relationships with interested
parties, especially community members, and realize highly unique andvalue-added urban development.
This development will help expand the Group’s leasing profit, and wewill continue contributing to the increase in value of the entire area byfurther enhancing the allure of the YNK area and solving local social
issues through urban development.

Gofukubashi Project (Urban Redevelopment Project for Yaesu 1-chome North Area)

Kyobashi 3-chome Project (Kyobashi 3-chome East District Urban Redevelopment Project)

Main Value Creation Initiatives

Main Value Creation Initiatives

Forming financial bases that help strengthen international competitiveness• Upgrading support facilities for high-level financial personnel who support international finance and urban Meeting, Incentive Travel, Convention, Exhibition/
Event (MICE)
Upgrading water-adjacent spaces and pedestrian networks• Conducting various collaborations to realize underground highways in Tokyo,
upgrading outdoor public spaces, and upgrading pedestrian networks
Strengthening emergency preparedness and reducing environmental impact• Upgrading emergency response facilities and working to promote more effective use of energy across the entire area

Upgrading urban infrastructure to help enhance the fun within awalkable distance across a broader area
• Fostering excitement and building multilevel pedestrian networks connecting the Tokyo Sky Corridor
Introducing urban functions that help foster excitement in the area
• Upgrading world-class lodging facilities and facilities that support artsand craft culture
Strengthening emergency preparedness and reducing environmental impact• Taking measures to strengthen emergency preparedness and reduce
environmental impact in the area

Total floor space: South Block: approx. 178,000 m2; North Block: 1,100 m2
Main uses: Offices, stores, lodging facilities, parking lots, etc.
Number of floors: South Block: 44 floors above ground, 3 floors below ground
North Block: 2 floors above ground, 1 floor below groundStart of new construction: Planned for FY2024
Completion of construction: South Block: Planned for FY2029; North Block:Planned for FY2032

Total floor space: approx. 164,000 m2
Main uses: Offices, hotels, stores, etc.
Number of floors: 35 floors above ground, 4 floors below groundStart of new construction: Planned for FY2025
Completion of construction: Planned for FY2029

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

26

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Commercial Properties Business: Progress under the Medium-Term Business Plan and Strategies Going Forward■ Initiatives for Forming an Innovation Ecosystem■ Initiatives for Area Management Services

In the YNK area, there are many properties with vacancies that are relatively cheap and have convenient trans-Tokyo Tatemono not only develops and operates buildings, but also

portation access, and it is easy to collaborate with major corporations. Against this backdrop, many startup

provides area management services. We are working with the local

companies have been coalescing in this area in recent years. We are using redevelopment projects to upgrade

community to utilize the event and public spaces of buildings to plan

the area’s functions and further concentrate major companies present there. At the same time, we are creating a

events and activities that contribute to the vibrancy and appeal of thebase for startup-related companies and encouraging interactions between a variety of companies and people inarea. In this way, we help people interact with each other, heighten theJapan and overseas. Through these efforts, we are focusing on forming an innovation ecosystem that perpetu-

appeal of the entire area, and strengthen the competitive advantage

ates a virtuous cycle of cutting-edge industry development and economic growth.

over other cities.
COFFEE PICNIC, and event held in the open
area of TOKYO SQUARE GARDEN

The spontaneous creation of innovation will contribute to the revitalization of the entire area and ultimately tothe economic growth of Tokyo and Japan. At the same time, we aim to further increase the value of our owned
assets as the area becomes more competitive.
■ Management and Operations That Leverage theCollective Strengths of the Group

Theme-based innovation centers

Formation of an innovation ecosystem in the YNK area
Multicategory
General companies
in the area

Sustainability

Existing Industry
× TechEvery year, we conduct a customer satisfaction surveyof our office building tenants. We have been gathering

Category by Sector
Manufacturing
companies in the area

Food-relatedcompanies in the area

Manufacturing

Creative talent
in the area

Food

Art

their feedback from the perspective of safety, security,

Trends in Overall Satisfaction and Intention toContinue Occupancy
Overall satisfaction

Intention to continue occupancy(Score)4.0 (Full score)

3.76

3.76

and comfort as we work to make improvements basedon customer needs.
Every year, all Group companies in the Commercial

2.0

Properties Business Division participate in an internal
event focused on building management and customer
Common management issues

0service. The event introduces specific examples of out-

Regional characteristics (agglomeration)

standing performance, honoring notable achievements

FY2018 FY2019 FY2020 FY2021 FY2022* Based on the Company’s own monitoring indicatorswith awards. This raises awareness of the importance■ Promoting Redevelopment Projects in other Areasof improving quality and customer satisfaction.

Besides the YNK area, the Company is working on multiple large-scale redevelopment projects in other areas,
mainly in Minato Ward and Shibuya Ward. With an eye toward 2030, we expect projects currently under way tocomplete their construction phase one after another, greatly contributing to rapid profit growth.

■ Adapting to Changes in Workstyles and Lifestyles
Due to the recent diversification of workstyles and lifestyles and the widespread adoption of telework, companies’ and workers’ mindsets toward the workplace have significantly changed, and the content of companies’

Shibuya 2-chome Project (Shibuya 2-chome West Area Redevelopment)

office strategies have become a major factor in attracting talent. The central offices that serve as the main work-

Main Value Creation Initiatives

places need to be situated in good locations where employees can gather easily. There is also increasing

Upgrading urban infrastructure to enhance transportation convenience and excitement•Creating outdoor public areas and upgrading bus terminals and pedestrian networks
Introducing urban functions that help enhance international competitiveness•Upgrading STEAM personnel training bases and international housing and lodging facilities
Strengthening emergency preparedness and reducing environmental impact•Taking measures to strengthen emergency preparedness and reduce environmental impact in the area

demand for advanced facilities and product planning that support productive and active interactions between

Total floor space: Block A: approx. 4,200 m ; Block B: approx. 255,000 m ; Block C: approx. 63,000 m
Main uses: Offices, stores, hotels, personnel training facilities, bus terminals, housing, etc.
Number of floors: Block A: 5 floors above ground, 1 floor below ground; Block B: 41 floors above ground, 4 floors below
ground; Block C: 41 floors above ground, 2 floors below groundStart of new construction: Planned for FY2025
Completion of construction: Planned for FY2029* Blocks A and B are envisaged as Type 1 urban redevelopment projects. Block C is envisaged as a voluntary joint rebuilding project.
222employees while they are at the office. In addition, realizing efficient anddiverse workstyles requires a wide range of workplace options for different types of work. This includes the creation of dynamic projectrooms, the use of spare time during transit, and the use of individual
booths for concentration.
Tokyo Tatemono is pursuing initiatives aimed at meeting the fullrange of office needs of companies. We offer high-spec central offices
as well as serviced offices, co-working spaces, and space-sharing services that cater to a variety of workstyles.

High-end flexible office that opened
in December 2022
Expert Office Nakano CP

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

27

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Commercial Properties Business: Progress under the Medium-Term Business Plan and Strategies Going Forward

products, as needs for relocation to advanced logistics facilities are strong due to strong demand for e-commerce,

Expansion of property sales to investors

the consolidation and closure of existing logistics bases, and the expansion of the third-party logistics (3PL) mar-

Initiatives for Property Sales to Investors
As stated in Key Strategy 1, as construction of large-

ket. This is true even though there is a risk of a shift in of the balance of receipt and delivery due to the increased

scale redevelopment projects are completed one

Commercial Properties Business: Balance of Real
Estate for Saleafter another from 2025, leasing profit will continue(Billion yen)

In fact, tenants have given our properties’ location, scale, and facility requirements excellent marks, resulting in an
extremely good leasing rate for the properties we have finished building in the last year. This has allowed the T-LOGI

to steadily expand.

series to maintain a high level of competitiveness.

157.6

To achieve sustainable profit growth and enhanceWith an eye on creating a REIT specializing in logistics properties, one ofasset efficiency, since the start of the previous

the reliable markets for upcoming real estate sales, we are promoting a

Medium-Term Business Plan (FY2015–2019), we

portfolio strategy that is conscious of area decentralization, and our policy is

114.7
107.9 110.2

have been developing diverse asset types that we
expect to sell to investors.

supply of logistics facilities.

to carefully select and enter locations with robust demand in the central

85.2

metropolitan areas of major regions, especially the Tokyo metropolitan area.

As for assets for property sales to investors in theGoing forward, we will continue imple-

Commercial Properties Business, we handle logistics

Completed
construction

properties, hotels, retail facilities, medium-size officebuildings, and more. There is still stiff competition for

menting cycles to accumulate and utilize
expertise as the number of our development
projects increase.

T-LOGI Honjo Kodama

acquiring land, but we are steadily securing properties through various means.

FY2018 FY2019 FY2020 FY2021 FY2022■ Initiatives for Hotels and Retail Facilities
Demand for the development of hotels and commercial facilities, for■ Expanding projects to develop logistics
properties
In our T-LOGI series of logistics properties in particular, development has been ramping up in recent
years against a backdrop of expanding demand forwarehouses as online businesses grow. Tokyo
Tatemono has also be steadily accumulating stock,accounting for 60% to 70% of assets for sale toinvestors in the Commercial Properties Businessbased on the total amount invested.

Number of Properties
Asset TypeAs of December 31, 2022

which we have promoted initiatives since the previous Medium-Term

Asset Size (billion yen)
Balance ofTotal amountreal estate
invested*for saleBusiness Plan, has been recovering since 2022 despite a temporary

In operation

Underdevelopment

Logistics
properties

8

16

78.8

Around 255.0

Hotels,retail facilities,
offices, etc.

16

14

78.8

Around 115.0

Total

24

30

157.6

Around 370.0*Calculated as the total amount invested by adding construction
costs incurred after the property was acquired to the book value
at the time it was acquired

same sector, it has been able to steadily secure highly
profitable projects by utilizing its extensive information• Selective investments in highly convenient locations

channels and relationships with operating companies• Development of facilities that meet every customer
need (spaces where people can comfortably work,
highly useful warehouse specifications)ing on projects that require development expertise,
thereby avoiding expensive acquisitions.
We believe that we will be able to meet future
demand by strategically acquiring land and planning

track record for retail facilities, ranging from urban facilities to largerecord with various operators for hotels. Due to these achievements,
we will continue proactively searching for

CANDEO HOTELSTOKYO ROPPONGIFUNDES Kamata(artist conception)

opportunities to acquire investments andprofit going forward.

■ Initiatives for Medium-size Office Buildings
Strengths of the product planning of theCompany’s logistics properties

that it has amassed over the years, as well as by focus-

19 pandemic. The Company has a broad development and operations
scale shopping centers in suburbs. We also have a collaboration track

While the Company entered the logistics property business relatively late compared to other companies in theharsh situation for profitability and the sales market due to the COVID-• Environmental consideration for the next generation(installation of solar panels at all facilities, acquisition of
ZEB and CASBEE (A or higher) as a general rule)

Amid the widespread adoption of workstyle reforms, telework, and satellite offices, the needs for office buildings are diversifying. In medium-size
office buildings as well, we believe demand will rise for offices that feel
healthy and comfortable (wellness) and respond flexibly to office worker
needs, not just in terms of high specs and design. We therefore
launched the T-PLUS brand and made a full-scale entry into the market.
We provide various services that help enhance convenience for customers, such as the use of advanced
technologies and leasing formats notbound by existing formats.

T-PLUS
Nihonbashi Kodenmacho

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

28

Residential BusinessTokyo Tatemono is engaged in the condominium and residential leasing businesses, with operations centering on the Brillia brand of refinement andcomfort. We offer high-quality housing based on a unique, comprehensive framework that includes all the functions needed to support a more comfortable life for our customers, ranging from planning and development to management, after-sales services, repair, and brokerage.

Main Business Categories

Related Material Issues
Contributing to a safe and secure society

For-sale condominiums businessFor-sale condominiums

Property sales to investors

For-rent condominiums

Services

Condominium management, remodeling, renovation
work, leasing management

Addressing the diverse needs of customers and society
Community building and revitalization

Regarding for-sale condominiums, Underpinned by anongoing low interest rate environment, an increase indual-earner households, and demand for more affluent
lifestyles, we have been able to continuously supply
around 1,000 to 1,500 units annually and achieve a highgross margin exceeding 20%. The land acquisition environment remains intensely competitive, but we are proactively engaging in reconstruction and redevelopment
projects and steadily building up our land bank.
Regarding for-rent condominiums, we have recorded a
decent level of gain on sales from FY2021 against a
backdrop of robust investment needs.

Revitalizing and utilizing real estate stock

Operating Revenue / Business Profit
Operating revenue

Number of Condominium Sales Posted / Gross Margin

Business profit(Billion yen)

131.2

120.5

29.8

15.8

14.1

7.1

Supplying highly popular properties, mainly in central Tokyo
Carefully selecting competitive properties in suburban areas
and more rural regions

Other areas of
the Tokyo metropolitan area

18%
Tokyo, other than
23 wards

7%

A strengthening trend toward prioritizing convenience amid
an increase in household income as the number of dual-inOpportunities come households rises

1,435
1,196

988
24.6

1,109

22.4

24.4

Growing interest in environmental measures due to climatechange and the increasing severity of natural disasters

33.3

Expansion of real estate investment needs and assets
for investment
Rising construction costs due to rising resource prices andlabor costs

23.3

17.0

Risks

FY2018 FY2019 FY2020 FY2021 FY2022
Condominium Sales Posted and Ratio of Sales by
Region (January 2016–March 2023)

1,315

131.3

99.1

97.7

Projects That Tokyo Tatemono is Pursuing(As of March 31, 2023)
Total: Approx. 11,700 units

FY2018 FY2019 FY2020 FY2021 FY2022
Breakdown of Land Bank* by Region(As of March 31, 2023)

The Company’s Advantages•Brand recognition and customer satisfaction ratings are among the highest
in Japan

Total: Approx. 8,000 units•Strong track record and expertise in large-scale redevelopment and reconstruction•A service supply framework that integrates production, sales, andmanagement

1,060
Not yet in the land bank
Approx. 3,700
Tokyo 23 wards

60%

FY2026–

Kansai regionand others

FY2024
Approx. 1,800

27.8%

FY2025
Approx. 1,400

Approx. 3,740

Already in the land bank
8,000 units

Contraction in the condominium market due to population decline
Drop in customer purchasing sentiment due in part to higher
interest rates

FY2023Kansai regionand others

15%

Operating Environment / Social Issues
Diversifying lifestyles are engendering more sophisticated,
more diverse customer needs

Number of condominium sales posted (units)
Gross margin (%)

Other areas of
the Tokyo metropolitan area

20.8%

•A wide array of information sources, such as financial institutions andexisting business partners, in addition to the Group network

Tokyo 23 wards

44.6%

Specific Initiatives under the Medium-Term Business Plan
•Investing in select locations expected to have strong competitive advantages
Tokyo, other than
23 wards

6.8%* Listed for the total number of dwelling units for the acquired
development site

•Focusing on redevelopment and reconstruction that requires expertise andhas high added value•Using our information sources to acquire properties for sale to investors
and engaging in dynamic, market-sensitive sales

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

29

Residential Business: Progress under the Medium-Term Business Plan and Strategies Going Forward
I think that the Company’s true strength will be tested because of thegrowing uncertainty in the external environment. We will continue further
enhancing the competitiveness of the Brillia brand by working diligently
to improve customer evaluations and offering high-quality condominiums
through an integrated framework spanning production, sales, and man-

■ Product Planning Phase
Meticulous attention is paid to every detail, from landscaping that takes into consideration the surrounding environment, to timeless exteriors and common areas, to the interior appointments and decor of apartments. Tokyo Tatemono
has received strong industry recognition, including 26 Good Design Awards to date,related to its Residential Business.

agement. We will continue to supply homes customers want and aim to■ Sales/Resales Phasebe No.1 in customer evaluations in all fields, including product planning,

To enhance customer convenience and showcase the attractiveness of our properties, we opened Brillia Gallery

customer services, and management.

Shinjuku in the Shinjuku Center Building as a base for consolidated sales of newly built Brillia condominiums in
February 2023. Included is a permanent concept showroom that allows visitors to experience actual interior spaces,

Hideshi Akita

fixtures, specs and other features. To confirm building exteriors, common spaces, and layout variations, the gallery also

Senior Managing Executive Officer and Director
Division Director of Residential Development Divisionoffers a high-definition VR corner. By enabling the marketing of multiple properties
within one facility, the gallery helps us lower our environmental impact and reduce
waste, such as furniture, that would be generated by opening a new sales centerfor each new property.

Further strengthening of for-sale condominium business

The same building houses the Brillia Base Total Residential Consultation Desk,
which consolidates into one place the Tokyo Tatemono Group’s help desks for resi-

Initiatives to Strengthen Our Brand
Brillia is a comprehensive residential living brand based ona concept of refinement and comfort that provides multifaceted support for people in their daily lives. Brillia pro-dential and related businesses, such as those for sales brokerage and renovation.

Planning anddevelopment
Renovation

The facilities work in collaboration, enabling a single location to provide consultations and a wide range of condominium-related information, including on new build-Sales

ing construction, repurchases, and remodeling.

vides not only buildings, but access to the various services■ Construction Phaseof the Tokyo Tatemono Group, supporting our customers’continually increasing lifestyle value.
Brillia’s “NEW LUXURY RESIDENCE” is based on theThorough quality control entails three levels of checks: in-house inspections, inspecBrokerage

Management

tions by a third-party organization, and inspections by the customer. As part of thisidea that true prosperity lies in the ability to pursue individ-

process, since 2004 we have conducted construction site tours in which customers

ual concepts of “space” and “time”—even against a back-are taken through buildings under construction. We have received positive feedback

drop of continually evolving values as the times change.
By maximizing the value of the Brillia brand, we aim to

VR corner where people can experience different layouts

After-sales
service

Life support

build relationships with top-notch customers, improving

Interior

the competitiveness of our properties.

about these tours, which provide a way to experience first-hand the comfort thatthe property offers.

A construction site tour

■ Property Management Phase
Our management staff receive hospitality training to ensure that they are qualified to support our customers and assure
their safety and comfort after moving into one of our properties.

Initiatives to Acquire Top External Rankings for Our Brands•Tokyo Tatemono ranks third in brand awareness*1 in the Tokyo metropolitan area.
•Won the Grand Prize in three separate categories as well as the Outstanding Performance Award in theComprehensive Evaluation category of the SUUMO AWARD,*2 the winners of which are chosen by buyers.
*1 Nikkei 2022 Condominium Brand Survey (responses of Tokyo metropolitan area residents (Tokyo, Kanagawa, Chiba, Saitama))*2 SUUMO AWARD 2023: Received the Outstanding Performance Award in the Comprehensive Evaluation category for condominium developers and sales companies in the Tokyo metropolitan area, as well as Grand Prize in the Livable Residence category, theAfter-Sales Inspection Satisfaction category for condominium sales and after-sales service, and the High Brand category for condominium developers and sales companies in the Kansai region.

(Sustainability Report 2023) Improving Quality and Customer Satisfaction pp. 53-56

In a survey*3 assessing condominium residents’ satisfaction with property management companies, Tokyo
Tatemono Amenity Support, the management and operation division of the Group, ranked third overall. For the fifth
consecutive year, it ranked first in the group of companies with less than 100,000
units under management. Its condominium management contract volume had risen
to 79,778 as of March 31, 2023. Tokyo Tatemono Amenity Support has branchedout from condominium management into a range of other business areas, including
remodeling and renovation.
*3 S ource: “Property Management Company Satisfaction Ranking,” www.sumai-surfin.com website ofStyle Act Co., Ltd.

Taking an integrated approach that combines production, sales, and management, our residential business provides
high-quality residences. This approach underpins the quality of the Brillia brand and contributes to customer acclaim.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

30

Residential Business: Progress under the Medium-Term Business Plan and Strategies Going Forward

Further strengthening of for-sale condominium business

Acquiring Highly Competitive Properties and Next Steps■ Business Environment and Major Properties Slated to Open
Although we will need to pay close attention the impact of rising home loan interest rates on customers’ desire
to purchase, there has not been a significant impact on sales to date. The condominium market remains strong■ Focusing on Reconstruction and Redevelopment Businesses

against a backdrop of persistently relatively low interest rates, an increase in dual-income households, andThe large-scale apartment complexes built to support Japan’s rapid post-war growth are continuing to age, anddemand for more affluent lifestyles.

a not insignificant number of buildings have serious problems, including questionable levels of earthquake resis-

Going forward, we plan to secure properties that garner significant attention, such as large-scale redevelop-

tance and anti-crime security features as well as a lack of elevators. As their residents also age and decline inment projects in city centers and large-scale high-rise condominiums in the center of regional cities. In fiscal

number, a major issue will be how to revitalize the aging buildings and communities connecting neighbors. We

2023, we expect to be able to achieve a high gross margin of 31%.

are focusing on rebuilding and redevelopment projects to meet the needs of urban districts currently densely
packed with wooden houses and to address the growing need to replace aging condominiums. By upgrading■ Efforts to Cater to Changes in People’s Lifestyles

our existing stock, we will promote safer and more secure urban development for customers and local residents

Demand continues to evolve amid changing workstyles and the shift to working

while creating new value aligned with the times and helping revitalize local communities.

from home that was triggered by the pandemic. We are responding to this by

Rebuilding and redevelopment projects involve a multitude of related parties, and reaching an agreement withworking to ensure that our properties provide both a comfortable work environ-everyone is exceedingly difficult and time-consuming. Tokyo Tatemono, however, is working on this project using

ment and a relaxing living environment. Our for-sale condominium Brillia City

the wealth of achievements and know-how it has acquired thus far. In addition to concentrating on rebuilding

Nishi Waseda boasts a range of innovative features designed for this purpose.

and redevelopment projects, we will continue to concentrate on business opportunities in highly convenient

The common area includes a co-working space with management services. In

locations and the development of high value-added housing.

the apartments, floor-to-ceiling doors (moveable partition walls) are installed to(Sustainability Report 2023) Revitalizing and Utilizing Real Estate Stock pp. 57-58

provide flexible privacy for residents who need to work from home.

Brillia City Nishi Waseda
Co-working Lounge

Major Properties Slated to OpenSHIROKANE The SKY*

Brillia Tower Dojima

Total units: 1,247(Tokyo Tatemono units: 310)
*Construction completed

Total units: 457 (Tokyo Tatemono units: 457)

2023
Brillia Tower Ikebukuro
Japan’s first redevelopment project for a high-rise apartmentcomplex integrated with the local ward government offices

Brillia Tower Minoh Senba
TOP OF THE HILL

Brillia Seiseki Sakuragaoka
BLOOMING TERRACE(Total units: 397(Tokyo Tatemono units: 202)

Total units: 253(Tokyo Tatemono units: 202)

2024

2025

Brillia Tama New Town
Japan’s largest reconstruction project,a 640-unit complex being rebuilt with 1,249 units

Brillia City ShakujiiKoen
ATLAS
Total units: 845 (Tokyo Tatemono units: 204)

Brillia Tower Hamarikyu
Total units: 421 (Tokyo
Tatemono units: 144)

HARUMI FLAG

Brillia Meguro Ohashi

Total units: 4,151 (Tokyo Tatemono units: 490) Total units: 114 (Tokyo Tatemono units: 97)

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

31

Residential Business: Progress under the Medium-Term Business Plan and Strategies Going Forward

Highlights

Expansion of property sales to investors

Brillia Art

Initiatives for For-rent Condominiums
We are expanding the Brillia ist series of for-rent condominiums in city centers as an asset for property sales toinvestors in the Residential Business. We help enhance capital efficiency and stably create profit through dynamic
sales against a backdrop of robust investment needs and product planning that meets customer needs.
Brillia ist is in harmony with urban living and offers residences with comfortable environments that efficiently create relaxation, based on the concepts of practicality and ever more radiant refinement along with thorough safety.
“ist” in the brand name represents the vision of tenants as people who are focused on living life their own way. We
are working to enhance the competitive advantages of properties in tangible and intangible ways, using such tools as

In line with plans to differentiate this brand and bolster employee creativity and imagination, theCompany focused on collaboration with and support for artistic activities.
Looking to enrich lifestyles through art, we reach out to creators outside the Company to meet customer expectations while, within the Company, we strive to provide opportunities for our employees toengage in artistic pursuits. For society as a whole, we will continue supporting cultural activities rooted
in local areas and work to revitalize communities.

customer satisfaction surveys to ascertain residential needs and setting up lounge spaces where people can telework.
In addition, to help realize a low-carbon society, we are proactively working toacquire green building certification and promoting the shift to ZEH. Recently, we have

Messages that meetcustomer expectations

also focused efforts on enhancing the emergency resilience of properties, to this end
installing both solar panels and storage batteries.
Balance of Real Estate Used for Selling For-rent Condominiums(Billion yen)

43.3

42.2

Creating opportunities toengage in art

Supporting
cultural activities
We support artistic cultural activities

We create luxury experiences andEmployees grow in part by bolstering

distribute information for Brillia owners

their creativity, which is the power of art,

rooted in local areas andhighly interested in culture and art.

and innovative imagination.

the revitalization of communities.

41.7

29.1
20.4
Alreadybuilt
FY2018FY2019FY2020

FY2021

FY2022As of December 31, 2022

Number of Properties (buildings)

Asset TypeIn operationFor-rent condominiums

Asset Scale (billion yen)

Under development Balance of real estate for sale

14

19

41.7

Total investment*

Approx. 70.0

*Calculated by adding construction and other costs incurred after acquisition to the book value of each property at thetime of acquisition.

Specific Initiatives

Art Exhibits in the Common Areasof Properties
We strive to incorporate art
into the design of common
areas and enhance theattractiveness of properties
by forming focal points inspaces.

Brillia Ichibancho
common area art

Disseminating Art at the BAG-Brillia Art
Gallery
In 2021, we opened BAGBrillia Art Gallery in the
Company’s building in the
Kyobashi area of Chuo
Ward to hold various exhibitions on the theme of living and art.
Brillia ist Shibuya Honmachi

Brillia ist Nishi Waseda

Support Artists with the Brillia Art Award
Since 2018, we have solicited,exhibited, and awarded artwork showcased in the headquarters gallery of the Brillia
condominium brand to support innovative artists blazing
trails for the next generation.

Headquarters gallery
exhibition space

Traveling Art Piano
We created the Brillia Art Piano, a street piano that anyone is free to play, with the aimof creating opportunities toclosely engage with art. The
piano travels around with theaim of realizing a world where
everyone is accepted andrecognizes each other’s differThe Art Piano
ences with art and music.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

32

Asset Service Business
Capitalizing on the range of services it is able to offer for the effective use of property and land, the Tokyo Tatemono Group provides comprehensive
solutions through its real estate brokerage, asset solution, management service, parking, and other businesses.

Main Business Categories

Related Material Issues

Real Estate Transaction Business

Brokerage and corporate real estate
operations

Property sales to investors(Asset Solution Business)

Office buildings, condominiums for saleor rent, retail buildings, and hotels

Parking Business

Parking lots

As for the brokerage and asset solution businesses,
their performances remained strong against the backdrop of an active real estate transaction market,
enabling us to stably record profit.
In the parking business, occupancy remained low in
fiscal 2020 and 2021 due largely to the impact of the
spread of COVID-19, but occupancy and profits have
improved since the second half of fiscal 2022 as theflow of people has recovered.
We will continue to work on strengthening our profitability and competitiveness while steadily expanding
our business.

Revitalizing and utilizing
real estate stock

Operating Revenue / Business Profit
Operating revenue

Business profit

42.8

44.1

46.6

(Individual spaces)

50.2

173.5

42.6

144.5

176.2
68,578 69,401

133.8

76,173 75,254 80,057

101.1

6.3

5.8

2.6

4.3

7.3

FY2018 FY2019 FY2020 FY2021 FY2022

FY2018 FY2019 FY2020 FY2021 FY2022•Solid relationships with customers and financial institutions and expertise injudging the value of real estate acquired over many years of experience

Growth in real estate investment demand due to low interest rates•Ability to offer one-stop solution services that draw on the resources of
the Group

Drop in customer purchasing sentiment regarding real estateand economic recession due in part to higher interest rates•Synergistic relationships between the Tokyo Tatemono Group and customers
springing from existing developments

Specific Initiatives under the Medium-Term Business Plan
•Capitalize on information sources to actively identify customer needs•Use expertise in judging the value of real estate to acquire properties with value-adding potential and sell properties quickly in response to market conditions

FY2018 FY2019 FY2020 FY2021 FY2022

Parking Business

The Company’s Advantages

Increased real estate transactions due to the shift toward asociety in which properties are used across generations
Opportunities

Risks

Parking Spaces under Operation(Billion yen)(Billion yen)

Real Estate Transaction and Asset Solution Businesses
Operating Environment / Social Issues

Brokerage Transaction Volume

Operating Environment / Social Issues
Demand is growing for large private parking lots as well as municipal and other public parking lots inconjunction with redevelopment projects
Opportunities
Development of new parking services in response to the wave of change in the automobile
industry represented by CASE*
Accelerated sale and repurposing of parking lots by landowners due to rising land prices
Risks

Worsening business conditions due to behavioral restrictions put in place following new infections

The Company’s Advantages•Track record and expertise in developing and operating large self-park parking lots
•Investment and development capabilities
for parking facilities and systems leveraging scale as Japan’s third-largest payby-the-hour parking business operator

Specific Initiatives under the Medium-Term Business Plan
•Aggressive expansion of large parking lot development through the diversification of contract types and proposals of cutting-edge systems•Boost competitiveness by developing and rolling out systems that contribute to improved operational efficiency and customer service*CASE: Connected, Automated/Autonomous, Shared & Service, and Electrification

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

33

Asset Service Business: Progress under the Medium-Term Business Plan and the Strategies Going Forward
Strengthening of brokerage, fund, and parking businesses

The world is changing rapidly and the real estate environment with it.

Brokerage Business Initiatives

Unlike most mass-produced products, the real estate products we handle
are unique and extremely expensive. The trust of our customers is therefore essential to closing such transactions as property sales and leasing. To
earn this trust, we work to ensure an accurate understanding of the various
real estate-related needs of our customers, based on which we create anddeliver products and services that only Tokyo Tatemono can provide.

The Tokyo Tatemono Group is strengthening its brokerage and corporate realestate activities with an eye to expanding opportunities for acquiring quality realestate information.
In corporate brokerage, focusing on the strong real estate investment needsof funds, corporations, and wealthy individuals, we are expanding information
channels and acquiring new clients by utilizing our properties for sale to investors
and deepening the relationships we have cultivated with our close clients to

Hideshi Akita

acquire large-scale brokerage projects. In retail brokerage, we aim to expand the

Senior Managing Executive Officer and Director
Division Director of Real Estate Solution Service Business Division

handling of secondary distribution by leveraging Brillia’s product reputation andcustomer base.

The Asset Service Business derives optimal solutions from the wide range of businesses within the Tokyo TatemonoGroup. The integrated strengths of the Group are what make our comprehensive consulting business possible.

Tokyo Tatemono Real Estate Sales
Shirokane-Takanawa Branch

Strengthening of brokerage, fund, and parking businesses

Through the Asset Service Business, we are aiming to achieve an optimal balance between providing solutions to

Parking Business Initiativessocial issues and growing as a company by adding new value to real estate and meeting the needs of customers.

We have developed and are operating about 80,000 parking spaces in 1,900 locations across Japan (as of

For instance, in the brokerage and asset solution businesses, we can contribute to the realization of a society in

March 31, 2023) under the NPC24H brand. By taking into account surrounding conditions, the size of the site,which properties are used across generations by repurposing existing, unused properties into quality products withand other factors, we are able to design and deliver optimal parking lots.

high market value. Moreover, we can contribute to the safety of residents and areas through work that renews andWe are working to expand the number of facilities under operation by drawing on our sophisticated operational

improves the earthquake-resistance and disaster-prevention features of properties. In the parking business, we con-expertise related to large self-park parking lots and other areas. By investing in digitalization, we will develop park-

struct parking lots equipped with power feeders and other equipment that support the adoption of EVs and throughing operations that use IT data. We will also actively work to make our parking facilities more convenient for users

the use of DX are helping to eliminate traffic congestion by promoting the smooth use of parking lots via the introduc-by providing new added value such as cashless parking and links to reservation systems.

tion of a smartphone accessible reservation system for hourly parking spaces that allows users to check availability.
The medium-term business plan calls for us to work through these businesses to facilitate the distribution of prop-

In addition, we are actively working to reduce our environmental impact. In the summer of 2022, we begandemonstration testing of an autonomous solar road surface power generation system that combines solar power

erties and provide quality assets that meet needs for the effective use of real estate and investment properties. By

panels embedded in the road surface and refillable battery-powered generators to generate electricity. As offurther growing the non-asset side of the business in conjunction with the expansion of Group-related assets, we are

March 31, 2023, we have also completed the switchover to green electricity at approximately 900 locations,pursuing ongoing profit growth and the improvement of capital efficiency.

about half of the parking facilities we operate, and are focusing on differentiating

Expansion Property Sales to Investors

Asset Solution Initiatives
The Asset Solutions business, which engages in the revitalization of existing real estate, has continuously posted stable profits
against the backdrop of an active real estate transaction market.
The property acquisition market remains heated and highly
competitive and we will continue to monitor market trends

Percentage by location

Major
regional cities

expanding our information channels and identifying new invest-

30.7%

The parking lot business is strongly affected by crowd
levels, business trip frequency, and tourism. Although it

OthersOtherswas heavily impacted by COVID-19, demand has recov-

5.4%

8.7%

ered with people returning to the streets, and we will con-

9.2%

attributable to rising interest rates and other factors whileleveraging the skills of discernment we have cultivated.

gers installed.

Percentage by asset type*As of March 31, 2023

Suburbs (Tokyoand 3 prefectures)

ment needs. We will also strive to acquire quality properties,

ourselves from our competitors by steadily increasing the number of EV char-

Asset Solution: Breakdown of Assets Held*

CentralTokyo(23 wards)

54.7%

retail properties
and hotels

19.6%

Officebuildings

37.8%

Condominiums
for sale or rent

33.9%

tinue to acquire new projects as well as improve theprofitability of existing projects.

Demonstration experiment at
NPC24H Minami-Osawa Ekimaeparking lot.

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

34

Other Businesses
Fund Business

Overseas Business

Strengthening of brokerage, fund, and parking businesses

Growth in overseas business

Through Japan Prime Realty Investment Corporation (a listed J-REIT) and Tokyo
Tatemono Private REIT, Inc., as well as through private funds, Tokyo Tatemono provides
a variety of real estate investment products to a broad range of investors, from institutional investors and pension funds to individual investors.

The Tokyo Tatemono Group has established overseas subsidiaries in Shanghai andSingapore and is partnering with local companies to engage in development projects in
China and emerging ASEAN countries that offer substantial growth potential.

Operating Environment / Social Issues
Opportunities

Risks

Leisure and Child Care
Business

Operating Environment / Social Issues
Rise in middle-income and wealthy individuals due to strong economic growth in Asian countries

Growing needs for real estate investment
Advantages

Expanding asset types available for investment
Mounting competition to acquire real estate
Shifts in the financing environment

Risks

Growing number of local companies seeking tie-ups with Japanese partners and local governments taking stronger measures to attract foreign capital
Changes in economic and political conditions and tightening of real estate regulations
Increased geopolitical and country risks

Our Advantages•Able to draw on the real estate expertise of Tokyo Tatemono to gain opportunities to acquire real estate and maximize
asset value
Specific Initiatives in the Medium-Term Business Plan

•Wealth of real estate development expertise and high-quality condominium development experience gained in Japan•Support the growth of J-REITs, private REITs, and private funds by increasing property sales to investors

Specific Initiatives under the Medium-Term Business Plan

•Increase profit opportunities by expanding the Group’s assets under management•Collaborate with prominent local developers knowledgeable about business practices and markets in their countries■ Status of Priority Policy Initiatives
We will strive to expand our asset portfolio by capitalizing on the Group’s expertise injudging the value of real estate to acquire promising properties while enhancing thequality of the portfolio through strategic asset replacement. At the same time, we will
help capture profit opportunities for the Group in asset and property management andother areas, increasing the sale of properties to J-REITs, private REITs, and private
funds in order to grow the Group’s assets under management (AUM).
Changes in Group AUM
Private funds, etc.
Tokyo Tatemono Private REIT, Inc.
Japan Prime Realty Investment Corporation(Billion yen)

1,133.0

1,311.0

1,211.9

1,326.8

1,344.2

709.7

778.7

756.2

757.8

53.7

62.6

64.7

85.7

97.5

435.0

439.5

467.5

484.8

488.7

644.2

FY2018FY2019FY2020

Our Advantages•Strong development track record (a total of about 25,000 units delivered to date) and a relationship built up over morethan 15 years with major Chinese developer China Vanke

FY2021

FY2022•Expand the business chiefly in China and other countries where we have an existing footprint. In addition, the Company
explores business opportunities in developed countries.

■ Leisure BusinessAs lifestyles in Japan grow more diverse and consumers increasingly choose to spend money on
experiences as opposed to goods, our LeisureBusiness aims to offer authentic experiences andhighly hospitable services that provide customers
with maximum relaxation and comfort.
Targeting the recent boom in pet tourism,
pet-friendly Regina Resort hotels feature facilities andservices on a par with luxury hotels while allowing
guests to be accompanied by their dogs in all rooms
and areas. Highly popular among wealthy dog owners, the number of Regina Resort with DOGS hotels
has increased to eight. We also operate Ofuro no
Osama bathhouses, where customers can freely
enjoy a dozen different baths and stone spas. We
have ten locations, mainly in the Kanto area. Many
customers enjoy these bathhouses as places forcommunication as well as spaces that support theirmental and physical wellbeing. The Group also operates 12 golf courses throughout Japan.

•Invest in short-term turnover projects, which feature relatively short business cycles and offer little risk of change inthe business environment■ Status of Priority Policy Initiatives
Strengthening Cooperation with Local Partners
Tokyo Tatemono has steadily expanded its
Overseas Businesses through partnerships withleading local property developers and sent its
employees to operational sites to ensure consistentrisk control. We have been involved in the development of for-sale condominium operations in China
with major local developer China Vanke for morethan 15 years. In addition, we are developing ourbusiness in Thailand, a market we entered in 2018,
together with several strategic business partners.
We will continue to make selective investments toacquire business opportunities in growth markets,
giving full consideration to the market environmentand country risk of each country.

Xuzhou-Chengbei
Project,China

Regina Resort Kyu-Karuizawa

Ofuro no Osama Wako

Total Project Cost

Approx. 35 billion yen
Tokyo Tatemono share
Approx. 30 %Kawaguchiko Country ClubThe Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

35

A Sophisticated Approach to ESG Management
Based on its long-term vision of becoming a next-generation developer, the Tokyo Tatemono Group is promoting advanced ESG management and actively implementing sustainability measures on a Group-widebasis in order to solve social issues and grow as a company at a higher level through its business.

ESG Management Framework

Highlights of Participation in Initiatives and External Evaluation
The major initiatives in which the Tokyo Tatemono Group participates are listed below. In addition, the Group has
been selected and evaluated by the ESG indexes and benchmarks listed.

Board of Directors

Evaluation Organizations and Initiatives/Indexes

Evaluation, etc.

U.N. Global Compact

Participation

President & Chief Executive Officer

Executive
Committee

Risk Management
Committee

Sustainability Committee
Committee Chair: President and CEO
Committee Members:
Directors (excluding external directors), senior andmanaging executive officers , general manager of
the Corporate Planning Department, general manager of the Sustainability Management Department,
general manager of the Corporate Communications
Department, general manager of the Personnel
Department, general manager of the General Affairs
Department, general manager of the Building
Engineering Department, and other persons designated by the President
Secretariat: Sustainability Management Department
Assisted by: Corporate Planning Department

Human Rights Subcommittee

Internal Control
Committee

TCFD

Approval

SBTi

Certification

RE100

Participation

CDP

B

GRESB Standing Investment Benchmark

5 Star

Health & Productivity Management Outstanding Organizations Recognition Program

White 500

MSCI Japan ESG Select Leaders Index
MSCI Japan Women’s Activity Index (WIN)FTSE Blossom Japan Index
FTSE Blossom Japan Sector Relative Index

Selection

S&P/JPX Carbon Efficient Index
Morningstar Japan ex-REIT Gender Diversity Tilt Index (GenDi J)
FTSE4Good Index Series

Sustainability Promotion Committee

TopicsIn order to promote Group-wide sustainability measures, we have established the Sustainability Committee,
chaired by the President and Chief Executive Officer, and the Sustainability Promotion Committee, a subordinatebody to carry out preliminary discussions on matters to be deliberated. In addition, a Human Rights
Subcommittee was established in January 2023 to further promote initiatives based on the Human Rights Policy.
The Sustainability Committee is positioned directly under the control of the President and is tasked with deliberating important ESG-related matters, establishing targets, monitoring their progress, and evaluating theirachievements.
In addition, matters deliberated by the Sustainability Committee are, on an as-needed basis, submitted for discussion and reported on to the Board of Directors, which is charged with its supervision.

ESG Finance
We have developed multiple financing frameworks that conform to the four principles (use of proceeds, project
evaluation and selection process, management of proceeds, and reporting) of the Green Bond Principles, theSocial Bond Principles, the Green Loan Principles, and the Social Loan Principles referenced by theInternational Capital Markets Association (ICMA) and others, and we continue to issue green bonds and sustainability bonds in accordance with these principles.

Balance of green bonds andsustainability bonds issued**As of December 31, 2022

140 billion yen(including 90 billion yen in hybrid corporate bonds)

The Tokyo TatemonoGroup’s Value
Creation Story

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Creation and Vision

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Creation Initiatives

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Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

36

Long-Term Vision and Materiality
Long-Term Vision

Materiality of the Tokyo Tatemono Group
Material Issues

Becoming a Next-Generation Developer

Fundamental Policy for Our Long-Term Vision

Contributing to a safe and secure society
Community building and revitalization
WellbeingA ddressing the diverse needs of customers
and society
Value co-creation and innovation

Revitalizing and utilizing real estate stock
Promoting a decarbonized society

On our path to realizing our long-term vision, we have identified 14 key issues from the perspective of both creating social value and the infrastructure needed to create such value with an awareness of the shared value withsociety that we will realize through our business.

Promoting a recycling-oriented society
Value creation platform

Approach to Value Creation by Addressing Materiality• Creating value of place andvalue of experience

Social implementation of technology

1. Solve a Variety of Social Issues• Contribute to the SDGs
2. Steady Profit Growth• Target for 2030: Consolidated business profit of 120 billion yen• Our basic policy for profit growth is to steadily increase stable leasing profit and make it the core of our
profit composition. We also aim for a well-balanced profit structure with an awareness of capital efficiency.

Contribution to SGDs

S trengthening Tokyo’s competitiveness as aninternational city

Social value creation

We live in a time of profound change. We are experiencing shifting demographics, growing diversity
among personal values, ever-accelerating technological development, and more. Amidst these uncertainties, a broad range of challenges to achieving social sustainability have emerged. The Tokyo TatemonoGroup understands that the role of developers must also change in fundamental ways. We are committed
to using our business to offer better solutions to society’s problems and bring our own growth as an enterprise to a higher level. By doing so, we aim to be a good company for all our stakeholders.

Shared values with society

KPIs and Targets p. 37• Coexistence with the Earthand the environment

Improve employee growth and job satisfaction• Value-creating talent
Diversity & Inclusion
Advancement of governance
Strengthen risk management framework• Realizing sustainability
management

By working to solve critical issues through our business and maximizing the positive impact we have on society while minimizing negative impact, we will contribute to the realization of a sustainable society as well as toour growth as a company.

KPIs and ESG-related targets were established based on the identified material issues.

p. 37

In order to achieve the targets, action plans with process targets in mind are incorporated into the businessBackground of Materiality Assessment

plans of each business division or business department. The Sustainability Promotion Committee ascertains the2018 Reviewed the SDGs and other social issues, aiming to take in a wide range of social issues connected toachieving the targets.

our business. Identified 35 social issues that the Tokyo Tatemono Group should consider.
2019 Assessed the importance of 35 social issues in terms of the magnitude of social needs and alignment withour business. Identified material issues.
2021 Conducted studies for revising material issues based on recent social trends as well as knowledge gained
through advice from external experts, participation in various initiatives, and communication with stakeholders. Approved material issues after validation and discussion by the Sustainability Committee anddirectors.

status of initiatives, and the Sustainability Committee establishes a PDCA cycle and manages progress toward

The Tokyo TatemonoGroup’s Value
Creation Story

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Creation and Vision

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Creation Initiatives

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TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

37

Material Issue KPIs and Targets
Below are the KPIs and targets we have established. We have stepped up efforts toward their achievement in light of the moving up of initial target achievement dates for some items related to the promotion of adecarbonized society in February 2023 as well as the upgrading of others.
Material Issues

Item

Reduction in greenhouse gas emissions

Scope

All businessAll business

Promoting a decarbonized society

Shift to renewable energy

Procure at least 50% of electricity consumed at owned properties from renewable energy sources by FY2024*2
Develop ZEH*2 for, in principle, all new sales of condominiums and rent condominiums*5

Commercial Properties BusinessResidential Business

Acquire Green Building Certification*2 for, in principle, all new office buildings, logistics properties, and condominiums for rent.*7

Reduction of waste emissions

Long-term buildings*8

20% reduction in the rate of waste emissions per unit by FY2030 compared with FY2019

Waste recycling promotion

Long-term buildings*8

Achieve a waste recycling rate of 90% by FY2030

Reduction of water consumption

Long-term buildings*9

Reduction of water consumption per unit compared with previous fiscal year

Promotion of use of recycled water

Office buildings with total floor area exceeding 30,000 m2

Install gray water*10 treatment facilities at, in principle, all new office buildings with a total floor area of more than 30,000 m2 by FY2030

Promotion of use of wood materials

Long-term buildings
Condominiums for sale or rent

Use domestic timber and certified timber in the interior and furniture of common areas of all new office buildings, for-sale and for-rent condominiums by FY2030.

Condominiums for sale or rent

Develop for-sale and for-rent condominiums that use CLT for major structural components by FY2023.

Long-term buildings*9

Communicate with tenants about sustainability at least 4 times a year

Condominiums for sale or rent

Communicate with residents and plan and implement sustainability measures

Tokyo Tatemono

Average training time per employee: 15 hours or more each fiscal year

Tokyo Tatemono

Career training participation rate: 100% each fiscal year

Tokyo Tatemono

Health checkup rate and follow-up test rate:100% each fiscal year

Promotion of skills development
Promotion of health management
Respect for human rights

Diversity & Inclusion

Procure 100% of electricity consumed at owned properties from renewable energy sources by FY2030*2

Residential Business

Collaboration and co-creation with customers
Improve employee growth andjob satisfaction

40% reduction in CO2 emissions compared to FY2019 by FY2030*1
Procure 100% of electricity consumed in business activities from renewable energy sources by FY2050

Develop ZEB*2 for, in principle, all new office buildings and logistics properties*4

Acquisition of Green Building Certification*6

Promoting a decarbonized society
Promoting a recycling-oriented society

Net zero CO2 emissions by FY2050*1

Commercial Properties Business

Promotion of development of ZEB and ZEH*3

Promoting a recycling-oriented society

Commercial Properties Business

KPI and Targets

Work-life balance
Promotion of diversity in our workforce

Tokyo Tatemono

Smoking rate: 12% or less each fiscal year

Tokyo Tatemono Group

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

Tokyo Tatemono

Average annual paid leave utilization rate: 70% or more each fiscal year

Tokyo Tatemono

Ratio of male employees taking parental leave: 30% or more by FY2025

Tokyo Tatemono

Ratio of women in management positions: 10% or more by FY2030

Tokyo Tatemono*1 Applies to the total of Scopes 1 and 2 and to Scope 3, category 11.
*2 These targets were revised in February 2023 through changes including moving forward the target timing for achievement. The targets shownin this table are the revised targets based on such changes including earlier achievement timing.
*3 In addition to “ZEB” and “ZEH(-M)”, includes Nearly ZEB, ZEB Ready, ZEB Oriented, Nearly ZEH(-M), ZEH(-M) Ready, and ZEH(-M) Oriented.
*4 Applies to new buildings for which design work began in January 2023 or later. Excludes certain properties such as joint venture properties orproperties with special uses.
*5 Applies to new buildings for which design work began in June 2021 or later. Excludes certain properties such as joint venture properties orproperties with special uses.

Employment rate of people with disabilities: 2.3% or more each fiscal year
*6 Mainly refers to DBJ Green Building certification, CASBEE building and BELS (Building Energy Saving Performance Labeling System) certification.
*7 Applies to new buildings for which design work began in January 2023 or later. Excludes certain properties such as joint venture properties orproperties with special uses.
*8 Applies to the main long-term buildings and commercial facilities for which we have substantial energy management rights and for which wehave submitted plans for the reuse and reduction of waste materials.
*9 Applies to the main long-term buildings and commercial facilities for which we have substantial energy management rights.
*10 Recycled water derived from rainwater and miscellaneous wastewater generated in buildings (e.g., wastewater from cooling towers and tenants’ kitchens). It is reused for non-potable purposes such as toilet flushing and watering plants.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

38

Environmental Strategy
Tokyo Tatemono Group’s Environmental Strategy
Under the Tokyo Tatemono Group Environmental Policy, we aim to contribute to the development of a sustainable

Promotion Systemsociety through environmentally conscious business activities. We have identified promoting both a decarbonized

Under the Sustainability Committee, which is chaired by the president, and its subordinate Sustainability Promotionsociety and a recycling-oriented society as environmental material issues and, by working to resolve these issues

Committee, environmental measures are promoted across the entire Group.

through our business, aim to realize coexistence with the earth’s environment, a value we share with society.
(Sustainability Report 2023) Environmental Management pp. 21-25

We have established environmental management systems aligned to the characteristics of each of our businesses. Within these systems, we have established PDCA cycles. In the Commercial Properties Business, a variety
of measures are being carried out under the Environmental Measures Promotion Group, a permanent organizationthat plans and oversees environmental measures in addition to providing support and guidance while monitoring
progress. In the Residential Business, various measures are being taken by the Environmental Measures Project
Team, which plans environmental measures, supports their implementation and monitors progress.
Other businesses and Group companies conduct their business according to environmental guidelines established in line with the Group Environmental Policy.

Road Map to Reducing Greenhouse Gas (GHG) Emissions
Road Map to Greenhouse Gas Emission Reduction

Medium- to Long-Term Targets for Reducing Greenhouse Gas Emissions

Assumed CO2 emissions to increase with business expansion

CO2 emissions: 40% reduction by FY2030 compared to 2019

Actual CO2 emissions after implementation of various
reduction measures

1 Energy saving and shift to renewable energy

Net zero by FY2050(SBT certification has been obtained for the FY2030 target)

2 ZEB/ZEH development

The Tokyo Tatemono Group is supporting initiatives to reduce greenhouse gas emissions and has established

Approx.
800,000 tons

(SBT) certification from the SBT Initiative, an international climate change program, for our fiscal 2030 target.
In addition, to help achieve our medium- and long-term targets, we have established the process goals that

3 Improvement of CO2 emission coefficient

Base emissions

the target at left as its medium- to long-term target. In September 2021, we obtained Science Based Target
Approx.
480,000 tons

−40%
4 Additional reduction measures
Target emissions for FY2030(−40% compared to FY2019)

include the further development of ZEB and ZEH, the introduction of renewable energy and the acquisition ofGreen Building Certification. We are also developing real estate equipped with energy-saving technology forexcellent environmental performance, and putting operational initiatives into practice in collaboration with building management firms and tenants.

0

Target emissions
for FY2050 (net zero)

2019

2022

Promotion of ZEB and ZEH Development p. 40

2030
Shift to Renewable Energy p. 41

2050

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

39

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Environmental Strategy

Major Environmental KPIs, Targets, and Results
Please refer to material issue KPIs and targets (p. 37) for detailed notes and information on the KPIs and targets established.
Material issue KPIs and Targets p. 37

For detailed information and notes on each item, please refer to the Data section of the Sustainability Report.

Reduction in Greenhouse Gas Emissions

Introduction of Renewable Energy (electricity)

Target: 40% reduction in CO2 emissions by fiscal 2030 (compared to fiscal 2019)
Net zero by fiscal 2050
Scope 1 (fuel-derived)(Sustainability Report 2023) Data (Environment) pp. 85–88

Scope 2

Target: Ratio of renewable energy in the amount of electricity consumed in
the business activities of the Commercial Properties Business
50% or more by fiscal 2024,100% by fiscal 2030
Rate of introduction（％）

Amount introduced (Thousand kWh)Scope 3(Thousand tons of CO2)

(Thousand tons of CO2)

22,735

1,172

131
117

116

16.3

970

107

109

835

626

105

96

88

No
data

15

12

13

19

No
data

FY2018FY2019FY2020

FY2021

FY2022FY2018

Obtaining Green Building Certification

FY2019FY2020

FY2021

FY2022

Reduction of Waste Emissions and Promotion of Recycling

Target: Percentage of newly developed properties obtaining Green Building
Certification: In principle, 100%.

Target: 20% reduction in emissions per unit of production compared to fiscal
2019 by fiscal 2030
90% waste recycling rate by fiscal 2030
Waste emissions per unit of production (ton/thousand m2)
Recycling rate (%)

Percentage of properties obtaining certification (%)

56.4

No
data

No
data

FY2018FY2019FY20203,675

2.7

FY202165.7

FY2022

Reduction of Water Consumption
Target: Reduction of water consumption per unit compared with previous
fiscal year
Usage of water per unit (m3/m2)

5.3

5.3

62.5

No
data

0.70

0.79

60.9

40.7
36.6
38.3
FY2018FY2019FY2020

FY2021

FY2022

No
data

No
data

No
data

FY2018FY2019FY2020

FY2021

FY2022

No
data

No
data

No
data

FY2018FY2019FY2020

FY2021

FY2022

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

40

Environmental Strategy

Promotion of ZEB and ZEH Development
For newly constructed properties, the Tokyo Tatemono Group is working to create Net Zero Energy Building (ZEB) and Net Zero Energy House (ZEH). Buildings designated ZEB and ZEH are designed to provide a comfortable indoor atmosphere while consuming no primary energy on an annual basis. According to the amount of energy creation and conservation, ZEB and ZEH fall into the following four categories and the overarching intention is to improve both of these metrics.

ZEB Oriented
Types of ZEB

Basic building

Energy saving only

30 % or more

40 % or more

ZEB Ready

Nearly ZEB“ZEB”

Energy saving Energy saving + Energy saving +energy creation energy creation
only

50 % or more

75% or more

100%

Promotion of ZEB Development

ZEB Ready-certified properties“ZEB”certified properties

We aim to contribute to the promotion of
ZEB by registering as a ZEB Leading
Owner, as part of an open call for applications by the Sustainable open
Innovation Initiative (SII).
In 2019, Hareza Tower became thefirst to receive ZEB certification in thepartial assessment of mixed-use high-risebuildings. As of the end of December
2022, two of our office buildings werecertified ZEB Ready and seven logistics

Tokyo Tatemono Shijo Karasuma
Building EAST
(Completed in 2022)

properties were certified “ZEB”.
Hospitals,
retail facilities, etc.

Offices,factories, etc.

Hareza Tower(Completed in 2020)

Promotion of ZEH Development
ZEH-M Oriented

Types of
ZEH-M

Energy saving only

Basic building

20 % or more

ZEH-M
Ready

Nearly
ZEH-M“ZEH-M”

Seven logistics properties,
including T-LOGI Narashino (Completed in 2022)

ZEH-M Oriented-certified properties

Since the initial open call for applications in
May 2018, we have been registered with theEnergy saving + Energy saving + Energy saving +energy creation energy creation energy creationZEH Developer Registration System, and weare currently working to build ZEH condominiums (ZEH-M). Efforts are being made to

50 % or more

75% or more

100%

increase energy-saving performance, including by improving the insulation performanceof outside walls, adopting highly insulated
window sashes, and opting for high-efficiency
hot water supply equipment. All condominium
properties designed in June 2021 or later are
being developed as ZEH-M in principle. We
are working to convince our clients of the
comfort and advantages of ZEH-M and to win
their support for our environmentally responsible approach to real estate development.

Brillia Tsurumaki (Completed in 2019)

Brillia Tower Seiseki Sakuragaoka
BLOOMING RESIDENCE(Completed in 2022)

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

41

Environmental Strategy

Shift to Renewable Energy

Acquisition of Green Building Certification

Tokyo Tatemono works to lower the CO2 emissions of every facility. This includes using renewable energy sourc-

As of December 31, 2022, 22 properties among the office buildings, retail buildings, and for-rent condominiums

es for both internal power generation and consumption, the self-consignment of excess electricity generatedusing renewable energy sources to adjacent buildings, and the use of non-fossil certificates.
Additionally, we actively promote the use of renewable energy sources to supply our real estate holdings in
the Commercial Properties Business. In February 2023, we set new, higher targets: we now aim to use morethan 50% renewable energy by fiscal 2024 and 100% by fiscal 2030.
(Sustainability Report 2023) Shift to Renewable Energy p. 30

we own and manage have obtained DBJ Green Building Certification. We will continue to aggressively develop
real estate with respect for environmental and social effect in response to requests from stakeholders and tenants’ increasingly diverse needs.
(Sustainability Report 2023) External Evaluation and Certification for Green Building pp. 33-34

Acquisition Rate of Green Building Certification (as of December 31, 2022)• Acquisition Rate of Certification for All Properties
Owned and Managed by Tokyo Tatemono• Seven properties in total received DBJ Green Building certification in 2022

Generation and Use of Renewable Energy
The T-LOGI series of logistics facilities use a self-consignment system to ensure that excess electricity produced
at Tokyo Tatemono facilities is used effectively. The electricity generated by the large-capacity solar panels
installed on each facility’s rooftop is consumed in-house.
The self-consignment system of the T-LOGI series also won the Japan Association for Real Estate Sciences’
Minister of Land, Infrastructure, Transport, and Tourism Award at the fiscal 2022 Achievement Awards. The

Certification Acquired

62.5%

honor was presented in acknowledgment of Tokyo Tatemono’s initiatives toward carbon neutrality as well as theinnovative features of the pilot project that made this feasible. The T-LOGI series will, in principle, seek to obtain

Brillia ist Nakano Central Park
(completed in 2012)

ZEB status in the future.

Promoting a Recycling-oriented Society
The Tokyo Tatemono Group is aware that a building’s entire life cycle, from planning and design through construction, operation and management, and demolition, should take environmental protection and resource efficiency into consideration. In order to create environmentally friendly buildings, we take environmental
assessment into account during the planning and design stages. We also aim to reduce air and soil pollution by
decreasing the generation of waste and hazardous materials and managing them effectively. Also, we areattempting to increase the recycling rate by introducing materials that facilitate the recovery and recycling ofresources, decreasing trash generation from the project launch stage, and meticulously sorting waste once theproject has begun.
(Sustainability Report 2023) Promoting a Recycling-oriented Society pp. 36-37

Switching to Renewable Electric Energy
We are supporting the shift to renewable energy sources by employing non-fossil certificates with tracking forelectricity purchased from electric utilities in Tokyo Tatemono-owned office buildings, retail buildings, and for-rentcondominiums. (In our commercial properties business, about 22,735,000 kWh of renewable energy was
installed in fiscal 2022; for an installation rate of around 16.3%.)

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Foundations

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

42

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Environmental Strategy

Disclosure Based on TCFD Recommendations
In June 2020, the Group announced its support for Task Force on Climate Related Financial Disclosures (TCFD) recommendations. The societal issue of climate change necessitates international cooperation. As aresult, Tokyo Tatemono must also deal with it as a top priority. We acknowledge the value of disclosing financial data related to climate change and will seek to increase such disclosure as suggested by the TCFD.
(Sustainability Report 2023) Disclosure Based on TCFD Recommendations pp. 27-29

GovernanceOur analysis of the financial effects that climate change will have on our business has revealed the following risks

The Group’s Sustainability Committee, chaired by the President, deliberates, discusses, and reports on import-

and opportunities: Priority will be given to opportunities and risks that have the greatest potential for impact, andant matters such as the identification of climate change-related risks and opportunities, greenhouse gas (GHG)

initiatives and measures to reduce risks and maximize opportunities will be supported.

emissions reduction targets and policies, and the status of initiatives to address climate change. Significant
issues raised by the Committee are either placed on the agenda or reported to the Board of Directors, which
has oversight over them. In addition, the Sustainability Promotion Committee, a subordinate organization, con-

Risk/
Opportunity

Category

Itemducts preliminary discussions on matters to be brought before the Sustainability Committee and examines specific measures to achieve the goals determined through discussion.

Policies

Adoption of carbon pricing

Strategy (scenario analysis)
The analysis is based on the current scenario (a scenario in which the average temperature rises by 4°C or more

Regulations

compared to pre-industrial levels by 2100) and a transition scenario (a scenario in which the average temperature increase is limited to less than 1.5°C or 2°C). The
scope of the analysis was to identify the main risks andImportance Rating Map

opportunities—primarily for the Group’s core businessResidential Business—and to assess their materiality interms of their expected degree of impact on theGroup’s finances. The Group organized the analysis into
three impact periods: short term (1–5 years), medium
term (5–10 years), and long term (more than 10 years).

Likelihood of occurrence
Impact (monetary amount)

es of the Commercial Properties Business andTransition
risk

Low

Medium

High

Great

MediumHigh

High

MediumLow

MediumMedium

Small

Low

Low

Low

Technology
and markets

Reputation

Risk Management
Climate change risk is addressed within a Company-wide risk management framework and is acknowledged as

Physical
risks

Acute

Stricter standards for
GHG emissions andenergy saving

to its agenda as required, resulting in a system that is overseen by the Board of Directors and is ultimately
accountable to the president, who serves as the representative director.

Technology

Indicators and Targets
To tackle climate change and accelerate the realization of a decarbonized society, the Tokyo Tatemono Group
has set a medium- to long-term goal for decreasing GHG emissions: 40% reduction in CO2 emissions comparedto FY2019 by FY2030 and reach net zero emissions by fiscal 2050. In addition, we monitor GHG emissions on aquantitative basis and report our findings.
Road Map to Reducing Greenhouse Gas (GHG) Emissions p. 38

Opportunity
Consumer
behavior

Markets

Materiality
4°C

1.5°C
/2°C

Imposition of carbon tax on own emissions (Scopes 1 and 2)

Medium-term—

MediumPrice hikes for construction materials, construction costs, etc.

Medium-term—

MediumHigher costs of converting new buildings to ZEB/ZEH

Medium-term

Low

Higher costs of introducing decarbonized building materials

Medium-term Medium

Low
MediumLow

Low

Higher utility costs due to change in energy mix

Short-tomedium-term—

Low

Higher utility costs due to higher demand for fossil fuels

Short-tomedium-term

Low—

Burden from renewableenergy procurement

Higher renewable energy procurement costs

Short-tomedium-term

Low

Low

Ensuring disaster
preparedness and resilience

Higher costs of ensuring disaster preparedness and resilience

Short-term

Low

Low

Delayed construction scheduledue to supply chain paralysis or disruption

Short-term——

Costs arising from countermeasures andconstruction period delays

Short-term——

Higher unit cost of
grid electricity

Frequent and intense extreme
weather events

Loss of rental income in the event of flooding

Short-term

Low

Low

Restoration costs arising from building damage and flooding

Short-term

Low

Low

Higher insurance premiums

Short-term

Low

Low

Rise in average temperature

Higher utility costs

Short-term

Low

Low

Efficiency Improvementswith ZEB andZEH Development

Reduction of utility costs

Short-term

Low

Low

Procurement of renewableenergy throughself-consignment

Reduction in utility costs and renewableenergy procurement costs

Short-term

Low

Low

Improved earnings fromhigh environmental
performance properties

Higher sales due to higher evaluation of ZEB/ZEH

Short-tomedium-term—

Medium

Improvement ofenergy-saving effects

Addition of energy-saving effects to rental income

Short-tomedium-term—

Low

Expansion of ESG Finance

Reduction in financing costs

Short-term—

Low

Tatemono Group. Each policy and strategy for reducing risk and seizing opportunities related to climate change
Chronic

Period of
ImpactIncrease in cost of energy-saving renovation of existing buildings Medium-term

one of the most critical hazards that could have a substantial influence on the management of the Tokyois examined by the Sustainability Committee. They are then communicated to the Board of Directors and added

Impact on Group business

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

43

Human Resources Strategy
Tokyo Tatemono sees human resources both as the source of corporate value creation and the realization of sustainable growth and as an indispensable foundation for management. In our material issues, we target
improving employee growth and job satisfaction as well as diversity and inclusion. With these issues in mind, we are working to secure and develop our next generation of human resources.

Employees and the Company Growing in Parallel with the Aim of Enhancing
Corporate Value

Positioning of Various Measures to Maximize Human Capital
We have put numerous strategies into place from the following perspectives in order to maximize human capital

Human Resource Philosophy

for the long-term growth of corporate value. Each of these measures, in our opinion, is interconnected, and

The Company’s growth is tied to its employees’ growth, therefore, we are responsive to their contributions.

when they all operate together, they free up highly driven individuals to work independently and serve as engines

Our human resources are the link between the general public and our business—it is through these interactions

for the organization’s expansion.

that employees are able to develop and show off their skills while serving as catalysts for the growth of the organization as a whole. To best harness the proactive energy of employees, we must implement human resource
systems and measurements that are in line with employee contributions based on using their abilities and their

Enhancement of Corporate Value

positions within the organization.
Human Resource Policy
We have established a Human Resource Policy designed to enable the building of a workplace that creates
added value while also providing an image of the kind of human resources we, as a company, should target.
Our goal is to develop an atmosphere in which employees may advance and perform to their full potential.
Through a two-way partnership in which we offer support and the employees respond to our assistance, we
seek to maximize human capital and enhance our corporate value.

Enhancement of corporate value

Promotion of various diversity
and inclusion measures
Various systems are in place to broaden
the scope of activities beyond gender,
generation, and so on, and to promotemutual understanding.

Identification andimprovement of issues
Engagement survey
360-degree feedback survey

Intra-group award system
Awards are presented annually for ideas andprojects that have taken on new challenges in
response to the shifting conditions of the times
as well as proactive efforts that aid in resolvingsocial problems.

p. 45

p. 45

Creation of a
Rewarding
Workplace

Maximize human capital
Diversity
on Display

Various measures to realize human resource policies
Employees
Desired Human Resources• Trustworthy people• People who forge their own paths

Organization
Creating a rewarding
workplace in which employees
can experience growth

Human Resource Philosophy

Human Resource
Development

Maximizing Human Capital
Culture design project
A Company-wide project team was formed
to spread Tokyo Tatemono’s vision of
becoming a next-generation developer aswell as to specify what represents theCompany’s character.

Diverse training and skill development
support systems
Communication
Revitalization

HealthManagementp. 44

Human Resource System and Structure
Our HR management system consists mainly of three components: a role rating system, a management by
objectives system, and a behavioral assessment system. We have also implemented a 360-degree feedback
survey for some levels of management to give managers a chance to take stock of their own performance aswell as put in place measures that facilitate opportunities for employee growth. Although Tokyo Tatemono’sorganizational structure is based on business divisions, we manage personnel functions on a Group-wide basis,and have in place a system to flexibly allocate the right people to the right jobs.

To assist employees in understanding their duties
and nurture their abilities in line with their developmental stage, Tokyo Tatemono offers a wide
variety of training programs, skill development
support systems, and so on.

Communication revitalization measures
A sense of community is promoted through lunch
meetings with management, company-sponsoredsocial events, the visualization of work experience, theuse of internal social media, the development of tools
to aid in sparking communication, and event planning.

Various health maintenance andpromotion measures
We conduct training and activities utilizing
ICT to raise awareness of health promotion
initiatives and improve health literacy.
p. 46

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

The Tokyo TatemonoGroup’s Value
Creation Foundations

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

44

Human Resources Strategy

Main HR-related KPIs, Targets, and Performance Trends

Human Resource Development and Environmental Improvement Initiatives

For detailed notes and information on the established KPIs and targets, see p.37 KPIs and targets based on

Training System and Encouragement to Earn Qualifications

our material issues. For detailed information and notes for each item, please refer to the Data section of theTokyo Tatemono has designed a rank-based training system with the goal of identifying responsibilities andSustainability Report.

honing abilities in line with each employee’s stage of development. We also rotate our employees between

Material Issue KPIs and Targets p. 37(Sustainability Report 2023) Data (Social) pp. 88-91

three departments during the course of their first ten years with the Company in order to provide them abroad perspective and experience. In addition, we are concentrating on encouraging a culture of self-directed
learning among employees through the creation of a system that enables them to consider and select thePromotion of Skills Development
Target: Average training time per employee:
15 hours or more each fiscal year
Career training participation rate: 100% eachfiscal year
Average training time (in hours)
Career training participation rate (%)

100

100

100

100

100

12.0

（％）

100

100
94.0

15.8

FY2019Health reexamination rate

100

100

100
98.0

98.3
63.0

83.7

FY2020(Sustainability Report 2023) Human Resource Investment and Development pp. 62-64

Level-Specific Training

Other training and support

Executives
General Managers
Group Leaders
Managers

12.2

Mandatory training for new
employees during which skills
and conduct expected by theCompany are reiterated.

Selective training in coaching,leadership, design thinking,breakthroughs, and other skills
development required for different management levels.

Assistant Managers

22.5

FY2018support systems, and externally dispatched training programs.

Target: Health checkup rate and follow-up test rate:
100% each fiscal year
Smoking rates: 12% or less each fiscal year
Health checkup rate
Percentage of smokers

18.3
14.4

knowledge and skills they need through a self-development support system, various qualification acquisition

Promotion of Health Management

FY2021

FY2022FY2018

21.0

17.2

16.0

12.1

Senior Employees

Training that contributes to the acquisition of basic financial
knowledge and strengthening of output capabilities, etc.

FY2019FY2020

FY2021

FY2022

New Employees

Acquisition of basic knowledge of real estate and the Company
Training that contributes to the acquisition of logical thinking, etc.

• Global Training• Business schools, cross-industry training, etc.
Externally, there are self-edification initiatives accompanied by review• Support for the acquisition of various certifications tostrengthen expertise
Holders of major certification types*
Real Estate Broker: 687
Real Estate Appraiser: 19
First-Class Architect: 89
Urban Renewal Planner: 87
Association for Real Estate Securitization (ARES)
Certified Master: 66* Figures for the company alone as of March 31, 2023
Includes employees seconded from Tokyo Tatemono tooutside positions

A Word from Employees

Work-life Balance

Promotion of Diversity in Our Workforce

Target: Average annual paid leave utilization rate:
70% or more each fiscal year
Ratio of male employees taking parental leave:
30% or more by FY2025
Average annual paid leave utilization rate
Ratio of male employees taking parental leave

Ratio of women in management positions
Employment rate of persons with disabilities
（％）

（％）

57.7

51.2

57.5

35.3
13.0

FY2020

FY2021

4.8
FY2018FY2019

67.8
50.0

18.2

Target: Ratio of women in management positions:
10% or more by FY2030
Employment rate of people with disabilities:
2.3% or more each fiscal year

FY2022

7.2

7.2

2.21

2.33

FY2021

FY2022

6.0
4.6

5.0

1.87

1.81

1.75

FY2018FY2019FY2020

Personnel Department

Yohei Echigoya(Joined in 2007)

Employee autonomy is crucial for businesses to
respond swiftly and flexibly to environmental changes
in the uncertain future we live in today. We have built
a business skill development training system with a
primary goal of improving employees’ autonomy inquestion-setting, speedy path-finding, and execution
in collaboration with various human resources.
We are rigorously examining human resource
development that adds to the ideal image of ourhuman resources in addition to our efforts in humancapital management.

Property Management (1)Department

Mio Takahashi(Joined in 2021)

I worked hard to study the business when I first started at the Company, and, with the help of numerous
training programs and the direction of my seniors, I
was eventually able to do my work in my own way. I
believe that using logic and improving my output are
essential for this. In order to do my work, it is crucial to
involve all parties, both inside and outside the organization, and to carry out my own ideas.
My objective is to grow so that I can earn the trustof clients.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

The Tokyo TatemonoGroup’s Value
Creation Foundations

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

45

Human Resources Strategy

Employee Engagement
Tokyo Tatemono conducts periodic surveys of its employees regarding job satisfaction while continuously work-

Diversity & Inclusion

ing to create a rewarding workplace. To gauge the level of connection that employees feel toward the Company,

Diversity & inclusion has been identified as one of our material issues and, to this end, we have set the following

we have been engaging an outside organization to conduct Company-wide employee engagement surveys

targets: a ratio of male employees taking parental leave of 30% or more by FY 2025; a ratio of women in man-since 2021. The survey findings are shared with management and staff along with explanations of the rationale

agement positions of 10% or more by FY 2030; and an employment rate of persons with disabilities of 2.3% orbehind each questions and how to interpret themore each fiscal year. To ensure that everyone feels a sense of fulfillment at work, we are fostering an environ-results so that they can be used to facilitate

Changes in Engagement Scores

future improvements.

Item

Division and branch managers create solutions for problems within their specific areas
with the help of specialists as required. They
then communicate and submit these solutions
to division personnel and the Personnel
Department, creating a problem-solving cycle.

ment in which diverse human resources can concentrate on their tasks and participate actively without feeling

21/12

22/06

23/03

Rating*

A

A

AA

Score

59.1

59.4

62.1

Note: T he scores, which are calculated independently by the survey
company, are ranked using a 11-stage rating scale.
Ratings: DD (score below 33), DDD (33–39), C (39–42), CC (42–45),
CCC (45–48), B (48–52), BB (52–55), BBB (55–58), A (58–61),
AA (61–67), AAA (67 and over)Principal Issue Identified and Its Solution
Identified Issue

Need to improve verticalcommunication within
the Company

hindered. We will continue offering services that address the increasingly complex and varied needs of our clients through the active engagement of our diversified staff.

Recruitment Activities

Creating a Workplace Where Diverse Human Resources Can Thrive• Recruiting without regard torace or nationality• Employing human resourcesof various nationalities at the
local subsidiaries of overseas
businesses• Established leave systems that all employees, regardless of gender, can utilize
for long-term care, childbirth, pregnancy, and childcare, and established are-employment system for former employees.
• Established a system to permit employees whose spouses have been sent
abroad to take a leave of absence of up to three years.
• Promotion of senior human resources to allow them to make use of the experience and knowledge gained in their careers thus far.
• Fostering the success of individuals with disabilities by allowing them to work inaccordance with their skills and traits.

Actions for Improvement
In recognition of the need for establishing and improving the strengthof ties between hierarchical positions within our organization, we are
implementing various communication revitalization strategies while
extending the scope of the 360-degree feedback survey to all generaland senior managers. The engagement survey will continue to be
conducted twice a year to track progress.

Investment in Human Resources

Amount of Investment in Human Resources*

Tokyo Tatemono provides and continually expands(Thousand yen)

the scope of its essential training programs, which are

77,505designed to foster the development of an environment in which each employee is able to learn necessary skills and fully express their unique abilities.

61,80775,461
63,894 60,904

By continually tracking how our investment in
human resources helps increase productivity we areable to create ever more effective human resource
investment measures.
FY2018 FY2019 FY2020 FY2021 FY2022* Total of expenses related to training conducted by the Company’s
Personnel Department as well as to supporting the Company’s
employees in acquiring qualifications and self-edification

A Word from Employees

Acquisitions Department

Business Planning Department

Hayato Isoda

Haruna Nakagami(Joined in 2015)(Joined in 2007)

I took about two months of childcare leave after thebirth of our first child to ease the burden on my wife
after the birth. The opportunity I had to witness mychild's development up close made me really happy,
despite the fact that I was a little overwhelmed bythis new experience. I now have a better appreciation of those who are juggling work and childcare
after taking my own childcare break. This experience
also made me aware of the necessity of creating a
structure that permits flexible working hours and aworkplace that respects and supports each employee's circumstances.

The friendliness of the staff influenced my decision tojoin the organization when I was job hunting. The
Company has not only recently introduced a flexible
work system that allows employees to work fromhome and make use of the flextime system, but it has
also fostered a culture in which employees who workand raise children are supported by the team members who work alongside them.
I confer with my boss and coworkers on how we
can work better together and then use the appropriate
systems to that end.
The Company has high expectations for its
employees, regardless of age or gender, and helps us
achieve our full potential.

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

The Tokyo TatemonoGroup’s Value
Creation Foundations

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

46

Human Resources Strategy

Health Management / Occupational Safety and Health
Health Management Policy and Approach

Major Health Management-related Initiatives

To enable our executives and employees to work vigorously and remain physically and mentally healthy, the Tokyo

We introduced fresh ICT-based health management initiatives in fiscal 2022, such as web-based dental check-

Tatemono Group has designated the president as the Chief Health Officer (CHO) and is working to maintain andups and walking events utilizing smartphone applications, as well as promoted the development of an environ-improve the health of each of its executives and employees in accordance with the Group Health Management

ment in which executives and employees can continue to work in good health, even amid the COVID-19

Declaration. As for our supply chain, we promote initiatives to maintain and improve the health of our suppliers

pandemic. Also, we put an emphasis on raising health literacy, for instance, offering training in the improve-through sound labor practices and healthy working environments, based on our Sustainable Procurement Standards.

ment of women’s health. Our objective is to have employees better understand their own health as well as thehealth challenges their coworkers may be facing and thereby foster a supportive work environment.

(Sustainability Report 2023) Health Management / Occupational Safety and Health pp. 65-69

In addition, due to anti-smoking initiatives that started in 2019, such as a complete ban on smoking during
work hours and smoking cessation treatment assistance through collaboration with health insurance unions,Tokyo Tatemono Group Health Management Declaration

the percentage of smokers in the Company in fiscal 2022 decreased to 12.1% (fiscal 2019 percentage ofTokyo Tatemono’s corporate philosophy, “Trust beyond the era,” encompasses our will to strive for the growth of the Company
and the creation of a prosperous society, taking pride in the trust placed in us that extends over a century.
To embody this corporate philosophy, we believe that supporting the health of our executives and employees as well as theirfamilies is vital.
We see the mental and physical health of executives and employees as the primary source of sustainable corporate growth
and actively promote activities for each and every person to maintain and improve their health.
As the Chief Health Officer, I will work to make the environment more conducive to achieving this, and I promise that our organization will pursue health management as a whole.
Hitoshi Nomura
Representative Director
President and Chief Executive Officer
Tokyo Tatemono Co., Ltd.

smokers: 21.0%).
A Word from Management
We see the wellbeing of our executives and workers as
the cornerstone of the Company’s growth. We actively
use ICT to improve health literacy in a fun way, thereby
encouraging behavioral change and supporting thecontinued vigor of our organizations. We will accept thechallenge of helping to realize wellbeing, which is one ofour material concerns and is also being introduced in
the Yaesu Project’s product planning.

Hiroko Iida
Personnel Department
Health Management &Diversity Promotion Group

Health Management Promotion System
Tokyo Tatemono established the Health Committee, which consists of representatives from the Personnel
Department and each office or location along with industrial physicians. The Health Committee generally convenes

Third-party Evaluation of Health Management

once a month for the purpose of improving standards of occupational health in the workplace and encouraging

Tokyo Tatemono and six group companies were certified as

officers and employees to maintain and improve their health. The Sustainability Committee, which is chaired by the

Excellent Health Management Corporations 2023, marking thepresident, sets occupational health- and health-related targets for each fiscal year, monitors progress toward andsixth time in three consecutive years that Tokyo Tatemono has

evaluates the achievement of these targets, and reports important matters to the Board of Directors.

been recognized as one of the “White 500” (the top 500 corporations in the health management survey results).

Health Management Promotion System

Occupational Health and Safety Initiatives
Chief Health Officer (CHO)
And Chairperson of the Sustainability Committee

Board of Directors
Report/Submit for discussion

Supervise
Goal setting, monitoring, evaluation of achievements, etc.

Supervise

We are supporting a variety of activities aimed at enhancing the occupational safety of our employees in order tofulfill the objective of guaranteeing the comfortable working environment mandated by the Tokyo TatemonoGroup Compliance Manual. Also, management and labor are collaborating to enhance the workplace. In order

Sustainability Committee

to create a suitable working environment and working conditions, labor and management engage in extensive
discussions based on the shared understanding that employee health and safety are crucial.

Personnel Department
Health Management andDiversity Promotion Group

Coordinate

Health Committee

Health insurance association

Tokyo Tatemono Labor Union

Industrial Physicians /Consultant psychiatrist

Outsourcing company

Third-Party Organizations

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

47

Social Initiatives
Human Rights and Supply Chain Initiatives

Human Rights Initiative

The Tokyo Tatemono Group firmly believes in the importance of upholding the human rights of every stakeholder

We created the Tokyo Tatemono Group Human Rights Policy based on the United Nations Guiding Principles on

involved in our business, and we do so as the cornerstone of all of our commercial endeavors.

Business and Human Rights to reinforce our efforts in this area. Under this policy, we strive to detect, minimize,

Based on the realization that the entire supply chain needs to be included in sustainable procurement that
addresses issues ranging from environmental conservation to respect for human rights, we are working on the
management of the entire supply chain.

correct, and remedy any human rights violations in our business in line with our strong commitment to respecting the human rights of all parties involved.
In addition, we have joined the UNGC, and our company is listed as a participating business and a part of the
Global Compact Network Japan, which is made up of businesses from Japan and other nations that have

Promotion System
The Personnel Department is a key player in the Group’s efforts to uphold human rights, and it engages withoutside experts and other related departments and Group enterprises to provide a framework for such activities.
Meanwhile, the Sustainability Committee, a group directly under the president's jurisdiction and overseen by the
Board of Directors, meets to debate and disseminate updates on human rights-related concerns and risks.
The Sustainability Committee formed the Human Rights Subcommittee in January 2023 as a subordinate
entity to carry out human rights due diligence and other duties while promoting actions connected with respectfor human rights within the Group.

signed the UNGC.
(Sustainability Report 2023) Respect for Human Rights pp. 47–50

Initiatives for Human Rights Due Diligence
The Tokyo Tatemono Group has been working to establish a human rights due diligence process. In May 2022,
the Sustainability Committee discussed and identified human rights issues that the Tokyo Tatemono Group willprioritize. Based on the priority issues identified, throughout our business we are working to understand the current status regarding human rights issues, which vary between business fields and countries or regions. We willtake appropriate action should we identify any problems. In particular, we are considering expanding the scope

Supply Chain Management
The Tokyo Tatemono Group collaborates with construction companies, design companies, and many otherbusiness partners to promote its business. We believe that it is essential to establish a sustainable supply chain,of our human rights assessments in our international activities, and we are making some progress in developing
human rights checklists for new projects.
Human Rights Priority Issues

as each of our business partners, as well as the Group, has an impact on the environment and society, including• Forced labor and child labor• Discrimination and harassment

via the procurement of materials and employment associated with construction.

• Impact on local communities• Employee working conditions
and working environment• Health and safety• Supplier working conditions andworking environment• Right to privacy

Sustainable Procurement Standards
In May 2021, the Group formulated Sustainable Procurement Standards for all vendors working with the Group’s
operations. We sent out notifications to our major business partners requesting that they promote their businesses based on these procurement standards. To determine the status of awareness and compliance, we conducted a survey in March 2023 and provided feedback on the results.
We also provided training to all of our employees in fiscal 2022 with the goal of promoting the understanding

Participation in Human Rights Due Diligence Promotion Council for Construction and Real Estate Sector
We are participating in a human rights due diligence study group involving eight construction and real estate companies. This study group conducts research and studies aimed at identifying and addressing industry-specifichuman rights impacts.

and application of these procurement standards. We will work to make sure these procurement standards are

Initiatives to Make Policy Known Company-wide

followed in all of our business endeavors while also broadening the pool of vendors covered.

The Company conducts regular training on human rights. In 2022, we held mandatory training for all employ-(Sustainability Report 2023) Supply Chain Management pp. 51-52

ees to improve basic understanding of human rights fundamentals and of basic areas such as the Tokyo
Tatemono Group Human Rights Policy. The training also updated employees on the Group’s latest humanrights initiatives (participation rate: 93.2%). The 2022 human rights training was also extended to all 21 Group
companies covered by the Tokyo Tatemono Group Human Rights Policy, with all Group company employees
also attending the training (participation rate: 86.9%).
The Tokyo Tatemono Group’s Compliance Codes of Conduct also stipulate “respect for human rights, prohibition of discrimination and harassment,” and “ensuring a comfortable work environment.” We also use compliance training for employees and managers to ensure thorough awareness of compliance.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

48

External Directors Roundtable

Improving the process fordiscussing medium- andlong-term issues to further
enhance the effectivenessof the Board of Directors
How can the Tokyo Tatemono Group further improve theeffectiveness of its Board of Directors? Four external
directors discussed their efforts over the past year toward
this goal as well as their outlook for the future.

External Director

External Director

External Director

External Director

Shuichi
HattoriYumikoKinoshita

Yoshimitsu
Onji

Takeo
Nakanoexchanged and discussions are held from a medium- to long-

to be addressed from a long-term perspective may undergo

term perspective.

many rounds of internal discussion in order to take into

Nakano : The proceedings of Tokyo Tatemono’s Board ofaccount such macroeconomic aspects as environmental

Directors are meticulously overseen by the chairperson withinchanges. In the past, such issues were often brought before

Hattori : It has been eight years since I assumed the post of

a comfortable atmosphere that easily facilitates discussion.

the Board of Directors at a slightly later stage accompanied byexternal officer. Over the past few years, I have noticed theOver the past year, we have been able to give particular atten-

a near-conclusive proposal. However, a process in which thescope of deliberations has widened to include such topics astion to advances in risk management in our discussions, fun-

Board discusses even drafts of proposals from the initial stage

management policies and plans, ESG, SDGs, compliance, anddamentally reviewing the system and creating a newis now being implemented. After gathering various opinions,internal controls.

framework, while also engaging in lively debate from a medium-the Board begins working to identify and resolve issues. The

to long-term perspective.

annual review of the medium-term business plan is one such

1. Improving the process by which mediumand long-term issues are discussed

When I took my position, the main role of the Board of
Directors was approving resolutions stipulated by theCompanies Act. Today, however, a variety of opinions are

Improvements can also be seen in the discussion process.

example of how the process has been improved. Even for

Issues requiring the Board of Directors attention and needing

such matters as the medium-term business plan, which has

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

49

External Directors Roundtablemany points of contention that are difficult to resolve, themore deeply incorporated into discussions.

Board of Directors can get an idea of issues within a big pic-

Onji : I have held the position of external director for five years

ture context early on in the process by sharing information

now. At the time of my appointment, board meetings focusedfrom the plan’s initial stages. As a result, discussion quality has

on individual projects in which a lot had been invested or that

improved, with the Board of Directors able to gain a solid

had lengthy timetables. Over the past few years, however, dis-

understanding of specific issues and then discuss how thecussions on medium- to long-term issues have become more

Company should proceed in the current year.

frequent. Although it may be a bit too soon to declare it per-

These improvements and opinions from external directors
have rendered the agenda, structure, and discussion process
at Board of Directors meetings more effective than in the past.

fect, the effectiveness of the Board of Directors is improving
year by year.
The issue right now is that individual investment projects, such

Kinoshita : From the perspective of improving effectiveness,as the Residential Business and large-scale development proj-

the explanations provided to external directors in advance ofects, still account for a considerable percentage of the agenda.

meetings have begun going into much greater detail comparedIn the future, I believe that internal directors will step awaywith last year, enabling us to participate in discussions with afrom their formal roles more often and engage in exchanges ofcriteria such as impact and likelihood of occurrence. I look for-deeper understanding of the issues. Although the role of an

opinion on long-term issues and policies simply as board mem-ward to more in-depth discussions from a long-term perspective.

external director is to monitor the executives, another aspectbers. This is where the next step toward improvement lies.

of our position is providing knowledge that those executives
can utilize. I also appreciate the improvement of the pre-board
meeting process because it has created an environment inwhich the opinions of people with diverse experiences are

Nakano : From the perspective of the Company’s businessmodel, I also believe that it is important to take a medium- to

2. Controlling risk by considering thenature of the business portfolio andinvestment strategy

long-term perspective, rather than pursuing short-term gains.
Profitability is, of course, essential from the point of view ofincreasing earnings for shareholders and enhancing corporate
value. In addition to this, earnings stability and the diversity ofrevenue sources are also important, and it is necessary to

Onji : The basic policy of Tokyo Tatemono’s business portfolio

examine how these should be enhanced.

should be discussed further in order to realize the Company’s

Onji : Having participated in several meetings with investors, I

ideal vision of the future. In a nutshell, the real estate businessgot a real sense of just how interested they are in increasing

isn’t uniform in nature due to differences in such factors as

corporate value. In this regard, I feel it necessary to align our

scale, business period, and asset type. For a number of realbusiness strategy and IR strategy as well as to pursue joint

estate properties, risk needs to be mitigated through system-discussions on raising corporate value.

atic investments in line with a basic policy covering when andNakano : Basing decision-making for future investments on a

how much to invest as well as business portfolio formation. I

medium- to long-term perspective of the world’s trends is very

look forward to further discussion on this basic policy and toimportant, as is considering how to build a highly profitable

hearing the opinions of various executives from the viewpoint

business portfolio that maintains stability and diversity.

of real estate professionals.

With regard to the next medium-term business plan that we

Hattori : In terms of risk, on top of the Risk Management

will be discussing, I would like to provide advice on proposals

Committee’s establishment in the previous year, discussions

made by the executives, drawing on my managerial experi-

have been expanded to include future risks based on suchence of formulating a considerable number of business plans. I

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

50

External Directors Roundtable

hope the formulation of the Company’s future structure willfind ways to stand out from the pack, which is somethingreflect a process wherein external directors provide opinions

Tokyo Tatemono is also beginning to work toward.

from a multifaceted perspective and engage in detailed discus-

Onji : As is the case with all companies, diversity, including

sions with the executives.

the advancement of women in the workplace, is essential to

Kinoshita : I believe that the upcoming process of formulating

the goal of standing out among the others. A free and vigorous

the next medium-term business plan will, in and of itself, be a

exchange of opinions among diverse human resources willvery good opportunity to deepen our common understanding oflead to an increase in Tokyo Tatemono’s corporate value by

the criteria for future investments. Using the medium-term busi-

facilitating the further elevation of existing businesses like its

ness plan’s annual review as a basis, I would like to continue

Brillia brand.

discussing areas that will need strengthening in the future andNakano : In addition to diversity, for Tokyo Tatemono to sus-

issues not currently being addressed in order to further invigo-

tainably increase its corporate value, it is vital that the Company

rate the Board of Directors and realize continued improvements.

strengthen measures to secure and nurture trustworthy
employees with expertise and an ambitious spirit. The premise

3. Further promoting sustainability
managementof such measures is to further solidify the Company’s corporate
culture. We are aware that the Board of Directors has not yet
been able to engage in in-depth discussions of personnel policies that will lead to medium- to long-term growth.

appropriate decisions based on this information. Businesses

Kinoshita : In terms of sustainability management, it seems

Kinoshita : I also feel that among the Company’s manage-

must be managed with an awareness of social demands.

that across the industry, every company is currently trying toment resources—namely, people, goods, money, and informa-At the same time, it is necessary to nurture human resourc-

tion—people will gradually take on more importance. I havees capable of making full use of their talents by providing

been made aware of the rising number of mid-career hires andopportunities for them to gain experience in management.

female employees in recent years. This year, if the opportunity

Nakano : From an independent and objective standpoint,presents itself, I would like to visit work sites and make pro-external directors must speak to executives with a solid under-

posals based on my own experience so that these employees

standing of how the Company is viewed not only by share-

can play a more active role with a sense of belonging. Entering

holders, but also by society, the community, employees, andinto new business ventures and achieving sustainable growthvarious other stakeholders.

without the backing of a rich and varied array of human capital,

With this in mind, as an external director, I will continue to makeboth in terms of quality and quantity, would be difficult.

suggestions from a medium- to long-term perspective based on

Therefore, during discussions for the next medium-term man-my career up to this point and the experience I have cultivated,agement plan, I would like that perspective of human resource

which I believe will contribute to the sustainable growth of the

management to be reflected.

Company and the realization of sustainable management.

Hattori : In terms of management quality, with the environ-ment surrounding companies drastically and rapidly changing,
there is high demand for human resources capable of collecting and analyzing information on geopolitical, economic, andsocial conditions as well as management capable of making

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

51

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Corporate Governance
The Tokyo Tatemono Group’s Corporate GovernanceCorporate Governance Structure

Policy and Concept

Corporate Governance Structure

Based on our corporate philosophy of “Trust beyond the era,” Tokyo Tatemono is striving to build optimal corporate governance, with the primary aim of enhancing efficiency while ensuring the soundness and transparency ofInternal Officers

External Officers

management, in order to achieve sustainable growth and increase corporate value over the longer term. In addi-

Appoint /Dismiss

General Meeting of Shareholders

tion, we actively and appropriately disclose information to ensure that shareholders and other stakeholders areable to gain an accurate understanding of the company’s business activities.

Appoint /Dismiss

We have also identified the advancement of governance as a material issue to achieve the Group’s long-term

ReportFinancial Statement
AuditorAppoint /Dismiss

Financial
Statement Audit

vision. We are promoting measures to improve profitability and the objectivity of management, such as further
enhancing the governance framework, in order to achieve the vision.
Structure
Tokyo Tatemono has selected a Company with Audit & Supervisory Board format as its corporate management
system. In addition, we have established a Board of Directors, an Audit and Supervisory Board, and a
Nomination and Remuneration Advisory Committee, which acts as an advisory body to the Board of Directors.
Our executive officer system clarifies the separation of functions between management and business execution.
Furthermore, we appoint external directors and external Audit & Supervisory Board members who help us oper-

ReportNomination and Remuneration
Advisory Committee: 7

Cooperation

Board of Directors (Directors): 12

Audit & Supervisory Board (Audit& Supervisory Board members): 4

Internal Officers: 8 (male only)
External Officers: 4 (3 male and 1 female)
Chair: Representative Director andChairman of the Board

Internal Officers: 3 (male only)
External Officers: 4 (3 male and 1 female)
Chair: Representative Director President &Chief Executive Officer

Dismiss

Internal Officers: 2 (male only)
External Officers: 2 (1 male and 1 female)
Chair: Board member (full-time)

ate under stronger management supervision and ensure transparency. This system ensures effective supervisionand supervisory functions with regard to management and also to business execution by directors of the Company.
Regarding Group governance, to heighten the efficiency of Group management and achieve synergies among
all members, we also make a contractual agreement with each Group company based on the Group BusinessAppoint /Supervise

AdviseManagement Standards. By setting out and informing each company of conditions such as items subject toprior approval and items to be reported to the Company, we are working to reinforce Group headquarters func-

Audit
Cooperation

President

tions and clarifying our engagement guidelines with each Group company.

Internal Audit Department

Characteristics
The characteristics of corporate governance at Tokyo Tatemono are as follows.
• It is a Company with Audit & Supervisory Board• The Chair of the Board of Directors is a nonexecutive officer• It has a Nomination and Remuneration Advisory
Committee• Four of its 12 directors are independent external
directors

Executive Committee• It has an Internal Control Committee, a Risk
Management Committee and a Sustainability
Committee

Risk Management
Committee

Sustainability
Committee

Business Divisions / Department

Tokyo TatemonoTokyo Tatemono Group

Group Companies

Internal Control
Committee

Audit

Audit

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

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52

Corporate Governance

Main Organizational Structures and Roles

Selection and Nomination of Audit &Supervisory Board Members■ Board of Directors (Number of Meetings in FY2022: 14)■ Executive Committee (Number of Meetings in FY2022: 41)

The Board of Directors is chaired by the representative director and

The Executive Committee is chaired by the Representative Director

chairman of the Board who is not a managing officer and comprises 12

President and Chief Executive Officer, comprises mainly executive

Policies and Term Periods

directors, four of whom are external directors. The board resolves key

officers concurrently serving as directors, and deliberates key matters

The Company comprehensively assesses candidates’ character, abili-

matters related to business execution, namely, management policies

related to the management of the Company, subsidiaries, and asso-

ties, expertise, experience, and other factors and then nominates peo-and the policy on acquiring large-scale investment projects, and super-

ciates. In addition, full-time Audit & Supervisory Board members

ple who possess qualities that help enhance the Group’s medium- tovises the business execution of directors. As a general rule, the Board

attend committee meetings and offer opinions as needed.

long-term corporate value as candidates for directors and Audit &of Directors holds ordinary meetings once a month and extraordinary
meetings as needed.
In addition, Audit & Supervisory Board members attend Board of
Directors meetings and offer opinions as needed.

Supervisory Board members. The lengths of the terms directors and■ Internal Control Committee

Audit & Supervisory Board members serve have been set in the Articles

The Internal Control Committee strives to evaluate, improve, andof Incorporation at two years for directors and four years for Audit &enhance the internal control systems of the Group. The Committee isSupervisory Board members.

chaired by the Representative Director President and Chief Executive

With regard to nominations, to ensure an appropriate level of■ Audit & Supervisory Board (Number of Meetings in FY2022: 14)

Officer and comprises mainly the Chairman of the Board and officers ofengagement with external directors, the Board of Directors reaches its

The Audit & Supervisory Board comprises four Audit & Supervisory

the Corporate Planning Department. In addition, full-time Audit &resolutions regarding nominations once it has received the results ofBoard members, two of whom are external Audit & Supervisory Board

Supervisory Board members attend committee meetings and offer

deliberations by the Nomination and Remuneration Advisory

members. A full-time Audit & Supervisory Board member chairs theopinions as needed.

Committee, a majority of which comprises external directors.

hold discussions, and makes resolutions. Audit & Supervisory Board■ Risk Management Committee (Number of Meetings in FY2022: 1)*

Criteria for the Independence of Independent External Directors

members attend Board of Directors meetings and Executive

The Risk Management Committee controls risk management and com-

Tokyo Tatemono deems external directors to be independent when, in

Committee meetings, offer opinions as needed, regularly receivepliance for the Group. The committee is chaired by the Representative

addition to meeting the criteria for independence stipulated by Tokyo Stockreports from financial statement auditors, departments, and other bod-

Director President and Chief Executive Officer and comprises mainly the

Exchange,* they do not fall under any of the categories shown below:

ies, and occasionally exchange opinions and information with various

Chairman of the Board, division directors, vice division directors, officers

parties. In addition, there are no particular conflicts of interest betweenof the Corporate Planning Department, and general managers of thethe Company and external Audit & Supervisory Board members.

corporate departments. In addition, full-time Audit & Supervisory Board

board, and the board receives reports on key matters related to audits,members attend committee meetings and offer opinions as needed.
■ Nomination and Remuneration Advisory Committee (Number of
Meetings in FY2022: 4)
The Nomination and Remuneration Advisory Committee was established as an advisory body for the Board of Directors to deliberatesuch matters as the remuneration of directors and the selection andMatters deliberated by and reported to the committee are reported to
the Board of Directors, and matters corresponding to agenda items for
Board of Directors meetings are added to the agenda as needed.
Risk Management Initiatives p. 59

1. A business partner of Tokyo Tatemono that accounts for 2% or moreof the Company’s consolidated net sales in the most recent fiscal
year or a person executing business on behalf of such partner
2. A shareholder of the Company that holds more than 10% of the total
number of voting rights of the Company or a person executing business on behalf of such shareholder
3. A representative, member, or employee of an auditing firm employed
as the financial statement auditor for the Company
4. A consultant, accounting professional, or legal professional who has

dismissal of director candidates and the representative director.
Committee members are selected from among directors, and the■ Sustainability Committee (Number of Meetings in FY2022: 7)

Representative Director President and Chief Executive Officer serves

The Sustainability Committee is chaired by the Representative Director

as chair. In addition, the committee utilizes the expertise and advice

President and Chief Executive Officer, comprises mainly executive offi-

of external directors. To ensure the objectivity and transparency ofcers concurrently serving as directors, and promotes sustainability

proceedings, the total number of members is limited to seven and themeasures all across the Group. Moreover, matters deliberated by the

majority must be external directors.

Board of Directors, who act as a supervising body.
A Sophisticated Approach to ESG Management p. 35*Established in December 2022

received remuneration (excluding director remuneration) of morethan 10 million yen from the Company in the most recent fiscal year
* From Tokyo Stock Exchange standards: Guidelines III 5, (3) 2 relating to the listing
management, etc. Rule 436-2: Examination to ensure effectiveness.

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

53

Corporate GovernanceStatus of External Officers (As of March 31, 2023)
Significant Concurrent Positions Outside the Company and Reasons for Selection
Title

Name

Concurrent Workplace

Concurrent Title

Reasons for Appointment

Director

Shuichi Hattori

Hattori General Law Firm

LawyerMr. Shuichi Hattori was appointed as an external director with the expectation that he will leverage his expertise and experience
to help strengthen the governance system, including overseeing the execution of the duties of directors from an independent
point of view.

OZ CorporationCEONIHON CHOUZAI Co., Ltd.

External Director

United Foods International Co., Ltd.

External Audit &Supervisory Board Member

Sotetsu Holdings Co., Ltd.

External Director

Sanyu Appraisal Corporation

External Director

FUJIYA CO., LTD.

External Director

Shouohkai Foundation

Chairman——

Yamaguchi Certified Public Accountant Office

Certified Public Accountant

KYORIN Holdings, Inc.

External Audit &Supervisory Board Member

OMOTESANDO SOGO LAW OFFICE

LawyerInstitution for a Global Society Corporation

External Audit &Supervisory Board Member

Director

Yoshimitsu Onji

Director

Takeo Nakano

Director

Yumiko Kinoshita

Audit & Supervisory
Board member

Takao Yamaguchi

Audit & Supervisory
Board member

Sayaka Hieda

Mr. Yoshimitsu Onji was appointed as an external director with the expectation that he will leverage his wealth of experienceand wide-ranging insight to help strengthen the governance system, including overseeing the execution of the duties of directors from an independent point of view.

Mr. Takeo Nakano was appointed as an external director with the expectation that he will leverage his wealth of experience andwide-ranging insight to help strengthen the governance system, including overseeing the execution of the duties of directors
from an independent point of view.
Ms. Yumiko Kinoshita was appointed as an external director with the expectation that she will leverage the international experience she developed working overseas and her diverse business experience in public-trust corporations to help strengthen thegovernance system, including overseeing the execution of the duties of directors from an independent point of view.
Mr. Takao Yamaguchi was appointed as an external Audit & Supervisory Board member because we expect him to leverage his
expertise and experience as a certified public accountant in the Company’s audit operations from an independent point of view.

Ms. Sayaka Hieda was appointed as an external Audit & Supervisory Board member because we expect her to leverage her
expertise and experience as a lawyer in the Company’s audit operations from an independent point of view.

Support System for External Directors and External Audit & Supervisory Board Members
The Corporate Planning Department provides explanations and information as necessary to support external

At the request of the Audit & Supervisory Board, we assign personnel to serve as staff for external board mem-

directors. The Department also serves as secretariat for the Board of Directors. For the purpose of ensuringbers to encourage the smooth execution of audit procedures. To enable full-time Audit & Supervisory Board

smooth proceedings and lively debate at Board Meetings, we conduct pre-meeting briefings for all external

members to acquire information needed to perform their duties, we have established a system that ensures they

directors regarding Board Meeting agenda items. In addition, we strive to promote greater understanding of ourcan attend Board of Directors and Executive Committee meetings, receive regular reports from financial state-business in part by regularly conducting property tours.

ment auditors and various departments, and exchange opinions with these parties whenever necessary.

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation Initiatives

Data Section

The Tokyo TatemonoGroup’s Value
Creation Foundations

54

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Corporate GovernanceStatus of Board of Directors
Timeline of Strengthening Functions at Board Meetings

Board of Directors and Its Composition

Tokyo Tatemono has incrementally upgraded its governance structure to strengthen corporate governance func-

The Board of Directors comprises 12 directors and held 14 meetings in 2022. (Average Board Meetingtions. Going forward, we will continue promoting initiatives aimed at building optimal corporate governance.

Attendance Rate: 99%)
Proportion of External Directors

2022
2021
2020
2018
2016

Percentage of director positions held by women
External Directors

Female41•Established the Risk Management
Committee•Revised the monetary standards of the agenda
items for Board of Directors meetings

1 / 124 / 128%33%•Established the Sustainability Committee•Introduced a stock-based remuneration system•Began evaluating the effectiveness of the Board of Directors•Established the Nomination and Remuneration Advisory Committee

Policy on Skills of Directors

Internal Directors

Male

8

11

Expertise and Experience of Directors (Skill Matrix)

Regarding the implementation of management strategies, theCompany’s Board of Directors passes resolutions on key matters relat-

Name

Position in the Company

GenderCorporate
Management

Finance andAccounting

ed to its business execution and needs to effectively oversee the execution of duties. With regard to the composition of the Board of

Makio Tanehashi

Representative director

Male

•

•

Directors, we strive to maintain a balance of diversity in terms of knowl-

Hitoshi Nomura

Representative director

Male

•

•

edge, experience, skills, and other factors to ensure that discussions

Katsuhito Ozawa

Representative director

Male

•

•

•

•

held at board meetings are useful and multifaceted. Also, to ensure its
effective and efficient functioning, we maintain the Board of Directors at
an appropriate level in terms of size. To facilitate the realization of mate-

Legal, Complianceand RiskManagement

Sustainability••

Real estateBusiness and
Urban
Development

Overseas
Business

•

•

•
•

•

Akira Izumi

Representative director

Male

•

•

Hideshi Akita

Director

Male

•

•

Takeshi Jinbo

Director

Male

•

•

Shinjiro Kobayashi

Director

Male

•

•

a set of skills (expertise and experience) that directors should possess

Fumio Tajima

DirectorMale•

to ensure that the Board of Directors functions more effectively.

Shuichi Hattori

Independent external director

Male

•

•

Yoshimitsu Onji

Independent external director

Male

•

•

•

Takeo Nakano

Independent external director

Male

•

•

•

Yumiko Kinoshita

Independent external director

Femaleriality as well as the long-term vision and Medium-Term Business Plan
the Company has set out, as detailed on the right we have established

ICT
andDigitalHuman Resourcesand Human
Resource
Development

•
•

•
•

•

•

•

•
•
•

•

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

55

Corporate GovernanceManagement Structure (As of March 31, 2023)
Directors

Makio Tanehashi

Katsuhito Ozawa

Hideshi Akita

Representative Director and Chairman of the Board

Representative Director
Senior Managing Executive Officer

Senior Managing Executive Officer and Director

April
March
April
June
June
March
July
March

1979	Joined The Fuji Bank, Limited
2006	Executive Officer; General Manager of Internal Audit Division of Mizuho Corporate Bank, Ltd.
2008	Managing Executive Officer; Officer in charge of Sales of Mizuho Corporate Bank, Ltd.
2011	Deputy President & Executive Officer; in charge of Branches Department of Mizuho Bank, Ltd.
2011	Representative Director, Deputy President & Executive Officer, in charge of Branches Department of Mizuho Bank, Ltd.
2013	President & Chief Executive Officer of Tokyo Tatemono Real Estate Sales Co., Ltd.
2015	Senior Managing Executive Officer and Division Director of Real Estate Solution Service Division of the Company
2016	Senior Managing Executive Officer, Director; Division Director of Real Estate Solution Service Division; Division Director of International
Business Division of the Company
January 2017	Representative Director, Chairman and Executive Officer of the Company; Director and Chairman of Tokyo Tatemono Real Estate Sales
Co., Ltd.
March 2019	Representative Director and Chairman of the Board of the Company (to present)
January 2021	Director of Tokyo Tatemono Real Estate Sales Co., Ltd. (to present)
March 2023	External Director of Sapporo Holdings Limited. (to present)

Hitoshi Nomura
Representative Director
President and Chief Executive Officer

1981	Joined the Company
2005	General Manager of Property Management Department of the Company
2008	Director, General Manager of Property Planning Department of the Company
2011	Managing Director, Division Director of Commercial Properties Division responsible for Kansai Branch and Kyushu Branch of the Company
2013	Managing Executive Officer and Director; Division Director of Commercial Properties Division responsible for Kansai Branch, Sapporo
Branch, Kyushu Branch, and Nagoya Branch of the Company
March 2015	Senior Managing Executive Officer and Director responsible for Personnel Department, Corporate Planning Department, and General
Affairs Department of the Company
January 2017	President and Chief Executive Officer, Representative Director of the Company (to present)

April
March
March
March
March

April
1987	Joined the Company
March 2007	General Manager of Residential Management Business Department of the Company
July2009	Director and General Manager of Finance Department of Tokyo Realty Investment Management, Inc.
March 2015	Managing Officer and General Manager of Corporate Planning Department of the Company
January 2017	Managing Executive Officer; Division Director of International Business Division and Leisure Business Division responsible for Corporate
Communications Department, Finance Department, Accounting Department, and Appraisal Department; General Manager of Finance
Department and International Business Department of the Company
March 2017	Managing Executive Officer and Director; Division Director of International Business Division and Leisure Business Division responsible
for Corporate Communications Department, Finance Department, Accounting Department, and Appraisal Department; General Manager
of Finance Department and International Business Department of the Company
August 2017	Managing Executive Officer and Director; Division Director of International Business Division and Leisure Business Division responsible
for Corporate Communications Department, Finance Department, Accounting Department, and Appraisal Department; General Manager
of International Business Department of the Company
January 2019	Managing Executive Officer and Director; Division Director of International Business Division responsible for Corporate Communications
Department, Finance Department, and Accounting Department; General Manager of International Business Department of the Company
January 2020	Managing Executive Officer and Director; Division Director of International Business Division responsible for Corporate Communications
Department, Finance Department, and Accounting Department; General Manager of International Business Department of the Company
January 2021	Senior Managing Executive Officer and Director; Division Director of International Business Division; Division Director of Commercial
Properties Division responsible for Acquisitions & Sales Department (joint responsibility), Kansai Branch, Sapporo Branch, Kyushu
Branch, and Nagoya Branch of the Company
April
2021	Senior Managing Executive Officer and Director; Division Director of Commercial Properties Division responsible for Acquisitions & Sales
Department (joint responsibility), Kansai Branch, Kyushu Branch, and Nagoya Branch of the Company
January 2022	Senior Managing Executive Officer and Director; Division Director of Commercial Properties Division responsible for International
Business, Acquisitions & Sales Department (joint responsibility), Kansai Branch, Kyushu Branch, and Nagoya Branch of the Company
January 2023	Senior Managing Executive Officer and Representative Director; Division Director of Commercial Properties Division responsible for International
Business, Acquisitions & Sales Department (joint responsibility), Kansai Branch, Kyushu Branch, and Nagoya Branch of the Company
March 2023	Senior Managing Executive Officer and Representative Director; Division Director of Commercial Properties Division responsible for
Leisure and Child Care & Staffing Business, Acquisitions & Sales Department (joint responsibility), Kansai Branch, Kyushu Branch, andNagoya Branch of the Company (to present)

April
1987	Joined the Company
March 2006	General Manager of Residential Management Department of the Company
January 2016	Managing Officer and General Manager of Personnel Department of the Company
January 2017	Managing Officer and Vice Division Director of Residential Development Division of the Company
January 2019	Managing Executive Officer and Division Director of Residential Development Division of the Company
March 2019	Managing Executive Officer and Director; Division Director of Residential Development Division of the Company
January 2023	Managing Executive Officer and Director; Division Director of Residential Development Division; Division Director of Real Estate Solution
Service Business Division of the Company (to present)

Takeshi Jinbo
Managing Executive Officer and Director

April1988	Joined the Company
January 2015	General Manager of Acquisitions Department of the Company
January 2018	Managing Officer and General Manager of Acquisitions Department of the Company
January 2019	Managing Officer; Vice Division Director of Residential Development Division; General Manager of Acquisitions Department of theCompany
January 2021	Managing Executive Officer; Vice Division Director of Residential Development Division responsible for Solution Service Department (joint
responsibility), Acquisitions Department, and Project Development Department of the Company
March 2021	Managing Executive Officer and Director; Vice Division Director of Residential Development Division responsible for Solution Service
Department (joint responsibility), Acquisitions Department, and Project Development Department of the Company
January 2022	Managing Executive Officer and Director; Vice Division Director of Residential Development Business Division* responsible for Business
Development Department, Acquisitions Department, and Project Development Department of the Company (to present)* The title was changed to Vice Director of Residential Development Business Division on January 1, 2023

Shinjiro Kobayashi
Akira Izumi

Managing Executive Officer and Director

Representative Director
Senior Managing Executive Officer

April1987	Joined the Company
March 2009	General Manager of Retail Management Department of the Company
March 2015	Managing Officer and General Manager of Urban Development Department of the Company
January 2017	Managing Executive Officer responsible for Personnel Department, Corporate Planning Department, and General Affairs Department;
General Manager of Corporate Planning Department of the Company
March 2017	Managing Executive Officer and Director responsible for Personnel Department, Corporate Planning Department, and General Affairs
Department; General Manager of Corporate Planning Department of the Company
January 2019	Managing Executive Officer and Director responsible for Personnel Department, Corporate Planning Department, General Affairs
Department, and Appraisal Department General Manager of Corporate Planning Department of the Company
July2019	Managing Executive Officer and Director responsible for Personnel Department, Corporate Planning Department, General Affairs
Department, and Market Research Department General Manager of Corporate Planning Department of the Company
January 2020	Managing Executive Officer and Director responsible for Personnel Department, Corporate Planning Department, General Affairs
Department, Market Research Department, Solution Service Department (joint responsibility) and ICT and Digital Strategy Promotion
Department of the Company
January 2021	Senior Managing Executive Officer and Director responsible for Corporate Communications Department, Personnel Department,
Corporate Planning Department, General Affairs Department, Finance Department, Accounting Department, Market Research
Department, ICT and Digital Strategy Promotion Department, and Acquisitions & Sales Department (joint responsibility) of the Company
January 2022	Senior Managing Executive Officer and Director responsible for Corporate Communications Department, Personnel Department, Corporate
Planning Department, Sustainability Management Department, General Affairs Department, Finance Department, Accounting Department, Market
and Policy Research Department, DX Promotion Department, and Acquisitions and Sales Department of the Company (joint responsibility)
January 2023	Senior Managing Executive Officer and Representative Director responsible for Corporate Communications Department, Personnel
Department, Corporate Planning Department, Sustainability Management Department, General Affairs Department, Legal & ComplianceDepartment, Finance Department, Accounting Department, Market and Policy Research Department, DX Promotion Department, andAcquisitions and Sales Department of the Company (joint responsibility) (to present)

April
1988	Joined the Company
March 2015	General Manager of Business Planning Department of Commercial Properties Division of the Company
January 2018	Managing Officer and General Manager of Urban Development Department of the Company
January 2022	Managing Officer; Responsible for Urban Development Department (2); General Manager of Urban Development Department (1) of theCompany
January 2023	Managing Executive Officer; Vice Division Director of Commercial Properties Division; Responsible for Urban Development Department(2); General Manager of Urban Development Department (1) of the Company
March 2023	Managing Executive Officer and Director; Vice Division Director of Commercial Properties Division; Responsible for Urban Development
Department (2); General Manager of Urban Development Department (1) of the Company (to the present)

Fumio Tajima
Managing Executive Officer and Director

April
1990	Joined The Fuji Bank, Limited
April2014	General Manager of Sales Department No. 17 of Mizuho Bank, Ltd.
April
2014	General Manager of Corporate Coverage Department VII of Mizuho Securities Co., Ltd. (retired in April 2019)
April
2018	Executive Officer; General Manager of Sales Department No. 17 of Mizuho Bank, Ltd.
April
2019	Executive Officer; General Manager of Global Products Coordination Department of Mizuho Financial Group, Inc.
April
2019	Executive Officer; General Manager of Global Products Coordination Department of Mizuho Bank, Ltd.
April
2021	Managing Officer; Division Director of Overseas Business Division of the Company
January 2023	Managing Executive Officer; Division Director of Overseas Business Division of the Company
March 2023	Managing Executive Officer and Director; Division Director of Overseas Business Division of the Company (to the present)

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

56

Corporate Governance

External Directors

External Audit and Supervisory Board Members

Shuichi Hattori

Yumiko Kinoshita

Takao Yamaguchi

External Director

External Director

Audit and Supervisory Board Member (Independent)

April
July
June
April
March
January
March
June
March

1984	Registered as a lawyer
1988	Established Hattori Law Firm (currently Hattori General Law Firm) (to present)
2004	External Audit and Supervisory Board Member of USHIO INC. (retired in June 2016)2007	Lecturer (in charge of Financial Instruments and Exchange Act) at Keio University Law School (retired in March 2023)
2009	External Audit and Supervisory Board Member of LOOK INCORPORATED (currently LOOK HOLDINGS INCORPORATED) (retired in
March 2019)2013	External Audit and Supervisory Board Member of POKKA SAPPORO Food & Beverage Ltd. (retired in March 2016)2015	External Audit and Supervisory Board Member of the Company (retired in March 2019)2016	External Director of USHIO INC. (retired in June 2018)2019	External Director of the Company (to present)

April
1984	Joined Bank of Japan
September 1991	Joined McKinsey & Company
April2004	Joined The National Museum of Emerging Science and Innovation of Japan Science and Technology Agency
June2011	General Manager, Corporate Planning Department of KCJ GROUP INC.
February 2016	Chairperson of JAPAN PROFESSIONAL FOOTBALL LEAGUE (retired in March 2018)
March2018	Chairperson responsible for extraordinary diplomacy of JAPAN PROFESSIONAL FOOTBALL LEAGUE (retired in March 2020)
July
2020	Chairperson of Tokyo Football Association (to present)
March2021	External Director of the Company (to present)
April
2022	Member of Hitotsubashi University Business Council (to present)

February 1985	Registered as a certified public accountant
September 1987	Joined Yamaguchi Certified Public Accountant Office
January 1996	Head of Yamaguchi Certified Public Accountant Office (to present)June2013	External Audit and Supervisory Board Member of SATO HOLDINGS CORPORATION (retired in June 2021)
June2015	Outside Corporate Auditor of KYORIN Holdings, Inc. (to present)
March2016	External Audit and Supervisory Board Member of the Company (to present)
March2019	External Audit & Supervisory Board Member of Lion Corporation (retired in March 2023)

Sayaka Hieda
Audit and Supervisory Board Member (Independent)

Yoshimitsu Onji
External Director

April1977	Joined The Daiei, Inc.
April
1994	General Manager of Corporate Planning Division of The Daiei, Inc.
September 1998	Director and Vice President of R.E. Partners, Co., Ltd. (retired in April 2000)
December 1999	CEO of OZ Corporation (to present)
2000	Managing Executive Officer of RECOF Office (currently RECOF Corporation)
March
June
2007	Director and Chief Corporate Officer of RECOF CorporationJune
2010	President and Chief Executive Officer of RECOF Corporation
October 2016	Chairman and Representative Director of RECOF Corporation (retired in September 2017)
December 2016	Director of M&A Capital Partners Co., Ltd. (retired in September 2017)
March2018	External Director of the Company (to present)
April
2018	Chairman and Director of Hongo Tsuji Business Consulting Co., Ltd. (retired in November 2018)
June
2018	Outside Director of NIHON CHOUZAI Co., Ltd. (to present)
December 2019	Outside Audit and Supervisory Board Member of United Foods International Co., Ltd. (to present)June2020	Outside Director of Sotetsu Holdings Co., Ltd. (to present)
December 2021	Outside Director of Sanyu Appraisal Corporation (to present)

Audit and Supervisory Board Members

Takashi Yoshino
Audit and Supervisory Board Member (full-time)

April
April
OctoberApril

1983	Joined The Yasuda Fire and Marine Insurance Co., Ltd.
2009	General Manager of Marine Insurance Office of Sompo Japan Insurance Inc.
2011	President and Director of Sompo Japan Nipponkoa Insurance Company of Europe Limited (retired in March 2016)2014	Executive Officer and General Manager of Europe Division of Sompo Japan Insurance Inc;. Executive Officer and General Manager ofEurope Division of NIPPONKOA Insurance Co., Ltd.
September 2014	Executive Officer and General Manager of Europe Division of Sompo Japan Nipponkoa Insurance Inc.; Executive Officer and General
Manager of Europe Division of Sompo Japan Nipponkoa Holdings, Inc. (retired in March 2016)
April
2016	Executive Vice President of Sompo Japan Nipponkoa Insurance Inc.
April
2018	Executive Vice President and General Manager of Enterprise Market Promotion Division of Sompo Japan Nipponkoa Insurance Inc.
(retired in March 2019)
March2019	Audit and Supervisory Board Member (full-time) of the Company (to present)

Isao Jinno
Audit and Supervisory Board Member (full-time)

April
April
April
April
June
April
April
April
June
March
April
June
March

1980	Joined The Fuji Bank, Limited
2007	Executive Officer and General Manager of Kobunacho Branch of Mizuho Bank, Ltd.
2009	Managing Executive Officer of Mizuho Financial Group, Inc.
2010	President and Representative Director of Mizuho Financial Strategy Co., Ltd. (retired in April 2012)2010	Managing Director of Mizuho Financial Group, Inc.
2012	Member of the Board of Directors of Mizuho Financial Group, Inc. (retired in June 2012) Deputy President and Representative
Director of Mizuho Bank, Ltd. (retired in April 2013)2013	President & CEO and Representative Director of Mizuho Trust & Banking Co., Ltd.
2017	Director and Chairman of Mizuho Trust & Banking Co., Ltd.
2018	External Audit & Supervisory Board Member of Sompo Japan Nipponkoa Insurance Inc. (currently Sompo Japan Insurance Inc.)(retired in June 2022)
2019	External Director of FUJIYA CO., LTD. (to present)
2019	Senior Adviser of Mizuho Trust & Banking Co., Ltd. (retired in March 2023)
2020	Chairman of Shouohkai Foundation (to present)
2021	External Director of the Company (to present)

Executive Officers
Position

April
OctoberJanuary
April
April
April
April
March

1988	Joined Yasuda Trust & Banking Co., Ltd.
2010	General Manager of the Kawagoe Branch of Mizuho Trust & Banking Co., Ltd.
2013	General Manager of the Real Estate Sales Department (3) of Mizuho Trust & Banking Co., Ltd.
2016	Executive Officer; General Manager of Trust and Total Sales Department (8) of Mizuho Trust & Banking Co., Ltd.
2018	Senior Managing Executive Officer and Director of Heisei Building Co., Ltd.
2018	Representative Director and President of Nihonbashi Building Services Inc. (retired in March 2023)
2020	Senior Managing Executive Officer of Heisei Building Inc. (retired in March 2023)
2023	Audit & Supervisory Board Member of the Company (full-time) (to present)

Name

President and Chief Executive Officer

Hitoshi Nomura

Senior Managing Executive Officers

Katsuhito Ozawa

Managing Executive Officers

Takeo Nakano
External Director

September 2007	Registered as a lawyer
September 2007	Joined HANZOMON SOGO LAW OFFICE (resigned in December 2009)
January 2010	Joined OMOTESANDO SOGO LAW OFFICE (to present)
March2019	External Audit and Supervisory Board Member of the Company (to present)
March2021	Audit & Supervisory Board Member (Independent), Institution for a Global Society Corporation (to present)

Managing Officers

Akira Izumi

Hideshi Akita

Hisayoshi Kato

Takeshi Jinbo

Shinjiro Kobayashi

Fumio Tajima

Hiroshi Takahashi

Satoshi Eida

Nobuyoshi Takahashi

Masayuki Okubo

Kazuki Sugise

Yusuke Mishima

Katsuhiko Tamai

Shigeru Sabayashi

Hiroto Fukui

Kenji Sugaya

Yuichi Kawazoe

Yutaka Onuma

Yuji Araki

Satoru Kondou

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

57

Corporate GovernanceWorking to Enhance the Effectiveness of the Board of Directors
Major Agenda Items for the Board of Directors

Evaluation of the Effectiveness of the Board of Directors

The main matters deliberated by the Board of Directors in fiscal 2022 were as follows. The Board discussed gover-

We conduct an annual survey on the structure, agenda items, and operation of the Board of Directors and eval-nance matters, such as establishing the Risk Management Committee, from a medium- to long-term perspective.

uate the effectiveness of the Board based on the results. Below is an overview of the effectiveness evaluation forfiscal 2022.

Classification

Business & finance

Main Agenda Items• Approval of annual accounts and budget, funding plans and funding procurement policy• Approval of business plans for the fiscal year and rolling over medium-term business plans
E: Establishment of medium- and long-term KPIs and targets for reducing waste emissions andpromoting recycling

Matters related
to management strategy

ESG
E: Environment■ Evaluation Process and Topics(1) Administer questionnaire survey to all directors and Audit & Supervisory Board members
Evaluation process(3) Discuss future issues and measures

E: Discussions on the implementation status of environmental KPIs and targets with a view toexpediting and improving the timeline for reaching certain targets.

Structure:	Ratio, number, specialization, and diversity of external directors
Agenda:	Number, content, and standard expressions of monetary amounts inagenda items

E: Discussions on formulating a roadmap for reducing greenhouse gas emissions

S: Society

S: Consideration of policies regarding the identification of priority issues related to human rights
and performance of due diligence

G: Governance

G: Confirmation of purpose of cross-shareholdings and review of policy

Topics

G: Establishment of the Risk Management Committee and the Internal Control Committee

Stock-related matters

Other matters• Sharing of IR activity reports and feedback• Convocation of general meetings of shareholders and determination of proposals to be submitted• Approval of appropriation of surplus and dividend policy

Operation:	Number of meetings, length of meetings, provision of explanations prior tomeetings, explanatory materials used, time taken for explanations, time
taken for discussion, and reported content
Other:	Support system for external directors

G: Confirmation of results of evaluation of the effectiveness of the Board of Directors; considerationof ways to further enhance effectiveness
Other(2) Aggregate, analyze, and share results with the Board of Directors■ Results of Evaluation
As a result of our evaluation, we confirmed that the effectiveness of the Board of Directors has been adequately
ensured. The evaluation results and remaining issues for main topics are as follows. In fiscal 2022, we revised
meeting proceedings, including the timing of the distribution of pre-meeting explanations and materials, in an• Progress report on large projects

effort to ensure livelier discussions. We will continue to address the issues identified so that we can further• Progress report on M&A projects (Expert Office, Inc.)enhance the effectiveness of the Board of Directors.

Cross-shareholdings
We acquire and hold shares of other companies for noninvestment purposes (cross-shareholdings) when we

Main Evaluation Items

Evaluation

Ongoing Issues

Composition

The number of directors is generally appropriate, as
are other considerations such as their composition.

—

determine that holding such shares is likely to contribute to maintaining and increasing the medium- and long-

The number of agenda items is generally appropriate,
as are the criteria for their inclusion.

term corporate value of the Group by maintaining and strengthening business relationships with business partners. We verify the appropriateness of our individual cross-shareholdings with a view to whether holding themwill continue to contribute to maintaining and increasing the corporate value of the Group. Verification is per-Agenda items

formed based on the transaction results and prospects of real estate transactions, joint ventures, constructionand equipment transactions, and financial transactions in addition to dividend results. In addition, we report veri-

impact on the stock market and other factors. In fiscal 2022, the total quantity of cross-shareholdings sold was
greater than the total amount purchased.

The agenda should continue to be reviewed with aview to further expanding discussions, including thoserelated to medium- to long-term management issues.

The frequency and the length of meetings are generally appropriate.

fication and disposal results to the Board of Directors at least once every year, and, if we determine that such across-shareholding is no longer significant, we seek to reduce the cross-shareholding while considering theDiscussions on medium- to long-term management
issues and management policies were expanded tosome extent compared to the previous year.

Management

The timing of the sharing of pre-meeting materials andthe support systems for external officers improved
from the previous fiscal year.

—

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Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

58

Corporate Governance

Remuneration of Directors
Regarding the remuneration of directors (excluding certain officers), our aim is to instill awareness of each officer’s responsibility to contribute to building corporate value not only in the short term but also over the longer term. To this end,
we have adopted a system that links a certain percentage of remuneration to business and stock price performance.
■ Basic Policy■ Remuneration Structure

The remuneration of directors (excluding external directors) comprises three elements: fixed remuneration,

Fixed remuneration (for Directors):

performance-based remuneration, and stock-based remuneration. The ratio of these elements is set appropriately

Up to 35 million yen per month (420 million yen per year)*1

based on the policy regarding the determination of payment ratios by type of compensation for Directors. The
amount of remuneration for each director is decided by the Board of Directors after consulting with theNomination and Remuneration Advisory Committee. The remuneration of external directors and Audit andSupervisory Board members is limited to fixed remuneration in consideration of their duties.

Performance-based remuneration (for directors excluding external directors):
Capped at 1% of consolidated ordinary profit and 2% of profit attributable to owners of parent for the year prior
to the fiscal year in question*2
Stock-based remuneration (for directors excluding external directors):

Policy on Payment Breakdown by Remuneration Type

Based on the stock-based remuneration system determined by a board benefit trust scheme, directors will be

Fixed Remuneration

Performance-based Remuneration

Stock-based Remuneration

Positioning

Basic remuneration

Short-term incentive

Medium- and long-term incentive

Variability—

Performance linked tosingle fiscal year

Stock-based

Proportion of total remuneration(approx.)50-60%

30-40%

5-10%

By resolution, the Board of Directors designates responsibility for determining the remuneration of each individual
director to the individual serving as to the Representative Director, President & Chief Executive Officer, who is best

awarded a maximum of 40,000 points per fiscal year (equivalent to 40,000 shares). At the time of retirement, thedirector will be paid an amount equivalent to the amount of company stock held calculated at market value.*3
Audit and Supervisory Board member remuneration:
Remuneration of Audit and Supervisory Board members is limited to basic remuneration according to whether
the member serves in a full-time or part-time position and capped at 8 million yen per month (equivalent to 96
million yen per year).*1*1 Based on a resolution of the 190th Ordinary General Meeting of Shareholders held on March 28, 2008
*2 Based on a resolution of the 195th Ordinary General Meeting of Shareholders held on March 28, 2013
*3 Based on a resolution of the 200th Ordinary General Meeting of Shareholders held on March 28, 2018

qualified to comprehensively evaluate the Company’s performance and the duties and responsibilities of the directors, after receiving the advice of the Nomination and Remuneration Advisory Committee.

Total Amount of Remuneration, Total Amount by Type of Remuneration, and Number of Eligible Individuals(as of the fiscal year ended December 31, 2022)■ System for Decision Making

Total Amount by Type of Remuneration
Executive Class

Number of
Eligible
Individuals

Directors (Excluding External Directors)

Having been designated by the Board of Directors, the Representative Director, President and Chief Executive

PerformanceLinked
Remuneration(Million Yen)

Stock-BasedRemuneration(Million Yen)

8

271

171

37

480

Audit and Supervisory Board Members(Excluding External Members*)

2

52

—

—

52

External Officers

6

54

—

—

54

Total

16

377

171

37

586

Officer creates proposals for fixed and performance-linked remuneration for each individual director in line with
their rank and responsibilities in the fiscal year under review. Then, after receiving the advice of the Nomination
and Remuneration Advisory Committee, the designated person determines the specific amount of remunerationfor each director.

Total
Remuneration(Million Yen)

Fixed
Remuneration(Million Yen)

* Two External Members

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Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

59

Risk Management Initiatives
Risk Management Initiatives
The Tokyo Tatemono Group has identified the need to strengthen the risk management framework as a material

Risk Management Structure

issue related to governance. The Group seeks to appropriately manage risks that could affect its business toachieve stable improvement in corporate value. To this end, we established relevant regulations and created arisk management framework to continuously monitor and control risks.
(Sustainability Report 2023) Risk Management pp. 79–80

Audit

Board of Directors
Deliberate and report

Audit & Supervisory Board

Supervise and approve

Risk Management Committee

Promotion Structure
Regarding the promotion of risk management, the Company comprehensively manages the Group’s risks based

Secretariat of the Risk Management Committee

on the risk management regulations. The Company designated the Representative Director, President and Chief
Executive Officer as the Chief Risk Management Officer and established the Risk Management Committee with
the Representative Director, President and Chief Executive Officer as the chair.
The committee evaluates and analyzes the Group’s material management risks (priority risks), formulates pre-

ReportCorporate departments and the planning departmentsof each business division (Second Line)

Directventive measures and countermeasures, regularly monitors the situation, and regularly submits relevant agenda
items and reports to the Board of Directors.

Monitor, support, and guide

In addition, each business division general manager acts as a Chief Risk Management Officer, which isdefined in the risk management regulations, and appropriately prevents and manages non-priority risks (department management risks).
Furthermore, corporate departments and the planning departments of each business division monitor, support, and offer guidance regarding the risk management of each department. The Internal Audit Department
audits and offers advice on actions taken by the planning departments of each business division regarding therisk management of each department.
In developing our risk management framework, we referenced ISO31000 (an international standard for risk
management), Enterprise Risk Management (ERM),*1 and the three-line model policy.*2*1 ERM: (Enterprise Risk Management) released by the (Committee of Sponsoring Organizations of the Treadway Commission) COSO.
*2 Three-line model released by The Institute of Internal Auditors (IIA).

Risk Action Organization (Risk Owner)(First Line)

Audit and advise

Business Division General Managers (risk owners of priority risks)
Department Offices

Group companies

Executive Committee

Sustainability Committee

Internal Audit Department(Third Line)

Compliance Subcommittee

Three-Line Model

The Tokyo TatemonoGroup’s Value
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Creation Foundations

Data Section

60

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Compliance Initiatives
Compliance Initiatives
Based on the Tokyo Tatemono Group Compliance

Compliance Training

Tokyo Tatemono Group Compliance Charter

Charter, the Group of course complies with laws
and regulations and promotes initiatives to ensurecompliance with social norms and corporate ethics.
This approach builds a long-lasting relationship oftrust with society and allows continued sound corporate activities.
In addition, by Formulating the Compliance Action
Guidelines and the Tokyo Tatemono Group
Compliance Manual and conducting compliancerelated education and training, we are working toconstruct organizations and education systems that
ensure a consistent high-compliance mindset isEvery year, the Tokyo Tatemono Group conducts compliance training via e-learning. In 2022, approximately
4,400 managers and employees across 19 companies participated in the training (a completion rate of 97.6%).

As we engage in corporate activities, weobserve the Compliance Charter below:

In the course of such training, we strive to enable participants to gain knowledge of or brush up on general•We adhere to laws, regulations, and other rules
and engage in fair, sound corporate activities.
•We act faithfully by thinking from the customers’ standpoint.

compliance topics; data management; the Real Estate Brokerage Act; the Criminal Proceeds Transfer
Prevention Act; the Whistleblower Protection Act,
which was amended in 2022; and the reporting system based on said act.
In addition, we conduct rank-based compliance•We contribute to making society better
through corporate activities.

training, on such topics as preventing power•We respect the personalities and values ofeach other and maintain a comfortable working environment.

management for officers and general managers

shared by its employees.

Established June 2009

harassment for line managers, compliance and risk

Number of training participants: Non-consolidated (persons)
Number of training participants: Group (persons)Training completion rate: Non-consolidated (%)
Training completion rate: Group (%)
99.3

99.8

(including external officers), and compliance forexperts as lecturers for seminars. These seminars
cover the latest examples of trials, tax reforms, and

100

100

98.0
97.6

2,862

importance to our business, we invite external
Compliance Structure

99.9

97.9

new supervisors.
On the subject of legal and tax matters of high(Sustainability Report 2023) Compliance pp. 81–84

Promotion Structure

Compliance Training*(e-learning: Group compliance)

860

FY2018873

FY2019884

FY2020

3,026

3,585

937

965

FY2021

FY2022

We established the Risk Management Committee toother information related to business activities

supervise the Group’s risk management and compli-

throughout the Group.

Scope of Collection: Tokyo Tatemono Group

Establishment of a Helpline

Number of Reports and Consultations Handled by
the Helpline (FY2022)

ance. Under this committee, we established theCompliance Subcommittee to specifically andBoard of Directors

ReportAudit & Supervisory Board

Directors

Audit & Supervisory
Board Members

dynamically deliberate compliance topics. This subcommittee deliberates compliance measures, monitors progress, and addresses compliance risks.
In addition, the Company’s Legal & ComplianceDepartment supports and guides Group companies’
compliance-related operations, facilitates cooperation
between Group companies, and aims to enhancecompliance functions across the Group.

ReportRisk Management Committee
Chair: President & Chief
Executive Officer

ReportInternal
Audit
Department

The Group has established the Tokyo TatemonoGroup Helpline (an external helpline), which can beused by all Group companies, in addition to internal
helplines in place at each company. This external

Compliance Subcommittee

helpline is intended to prevent and quickly resolve

Chair: Officer Responsible forthe Legal & ComplianceDepartmentcompliance violations, including legal violations, brib-

Audit

Legal & ComplianceDepartment7

ing complaints, reports, and consultations. The
privacy of anyone who uses the helpline is protected.
If the investigation or fact check that is carried out by

Corporate Planning
Department

the responsible department identifies a complianceviolation, we act quickly to rectify it and prevent

Cooperation and Compliance
Awareness Activities

Business Divisions

12

ery, fraud, and harassment, by handling whistleblow-

Secretariat

Receive
Reports

Other

Work-related
problems

Group Companies

recurrence. For more serious cases, the Risk
Management Committee (and Compliance
Subcommittee) is convened to discuss a response.

Other harassment

30

Sexualharassment

3

The Tokyo TatemonoGroup’s Value
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Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

61

Key Financial and Non-Financial Data
Financial Data
Unit

FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

Operating revenue

Million yen

194,161

220,026

237,049

260,012254,498

266,983

273,302

323,036

334,980

340,477

349,940

Operating profit

Million yen

30,89229,361

30,55934,43936,36344,757

46,76552,41049,63158,78464,478Business profit*1

Million yen

—

—

—

35,281

38,20646,44047,174

51,66849,84747,97966,304

Ordinary profit

Million yen

21,741

21,95917,317

24,79630,63539,41642,03644,61147,072

46,27063,531

Profit attributable to owners of parent

Million yen

10,243

10,121

82,944

16,35919,742

22,59927,277

29,796

31,79534,96543,062

Operating Results

Financial Position
Total assets

Million yen

895,296

938,161

1,319,465

1,297,112

1,314,558

1,441,050

1,450,091*2

1,564,049

1,624,640

1,650,770

1,720,134

Net assets

Million yen

212,491

262,276

305,808

312,530

325,593353,419

356,578

384,211399,129427,661456,838

Interest-bearing debt

Million yen

479,746434,763748,273

707,356

727,302814,032

857,117924,891

976,896

956,836

989,798

Cash flows from operating
activities

Million yen

57,332

22,135(4,790)21,76238,783(14,196)

19,74824,096

43,52465,889(3,332)

Cash flows from investing
activities

Million yen(15,385)

37,083

257,798(21,250)(53,024)(64,508)(63,577)(64,082)(66,724)(1,642)(21,204)

Cash flows from financing
activities

Million yen(35,855)(47,119)(277,787)(40,177)

9,005

77,99834,43848,00038,307(32,187)

18,421

Net increase (decrease) incash and cash equivalents

Million yen

6,586

12,804(24,744)(39,689)(5,164)(825)(9,513)7,794

15,14832,362(4,569)Cash and cash equivalents
at end of period
Million yen

39,46652,27186,90747,21742,053

41,22731,70239,49754,64587,00882,43910.0

Cash Flow

Financial Indicators
ROE

%

5.3

4.4

33.2

5.6

6.4

6.8

7.9

8.2

8.3

8.7

ROA

%

3.5

3.3

2.3

2.7*3

2.9*3

3.4*3

3.3*3

3.4*3

3.1*3

2.9*3

3.9*3

Equity ratio

%

22.9

26.7

21.7

23.2

24.2

23.9

24.0

24.0

24.0

25.3

25.9

Debt-equity ratio

Times

2.3

1.7

2.6

2.3

2.3

2.4

2.5

2.5

2.5

2.3

2.2

Interest-bearing debt/
EBITDA multiple

Times

11.6

10.9

15.9

13.4

13.0

12.5

12.7

12.6

13.4

13.3

11.1

Stock price information
Profit per share

Yen

23.79

23.55

193.1275.91*4

91.00

104.17125.79141.59152.12167.35206.15

Net assets per shareYen

476.23583.11665.51

1,390.07*4

1,465.30

1,589.98

1,605.70

1,794.15

1,862.81

1,996.52

2,135.08

Annual dividend per share

Yen

5

5

6

Payout ratio

%

21.0

21.2

3.1

20*4
26.3

26

30

35

41

46

51

65

28.6

28.8

27.8

29.0

30.2

30.5

31.5

*1 Business profit = operating profit + share of profit (loss) of entities accounted for using equity method. This is a profit indicator set in our medium-term business plan (FY2020–FY2024) reflecting overseas business growth. For comparative purposes, we have disclosed figures from the fiscal
year ended December 2015.
*2 We have applied the Partial Amendments to Accounting Standard for Tax Effect Accounting, etc., from the fiscal year ended December 2019. Figures for the fiscal year ended December 2018 reflect the retroactive application of this accounting standard.
*3 From the fiscal year ended December 2015, ROA = Business profit ÷ total assets (average at start and end of fiscal year).
*4 We implemented a one-for-two common share reverse stock split on July 1, 2015. The annual dividend per share for the fiscal year ended December 2015 is calculated assuming the reverse stock split occurred at the beginning of the fiscal year ended December 2015.

The Tokyo TatemonoGroup’s Value
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Creation Initiatives

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Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

62

Key Financial and Non-Financial Data

Non-Financial Data (Environmental)*1
Unit

2019

2020

2021

2022

(Tokyo Tatemono, Non-Consolidated)

t-CO2

—

1,100,693

1,288,946†

943,489†

732,547†

Full-time (FT) employees

Scope 1 (fuel-derived)

t-CO2

—

15,05011,981†

12,657†

18,522†

Ratio of female FT employees

Scope 2t-CO2—115,897

104,736†

96,195†

88,124†

Number of managers

Scope 3t-CO2—

969,745

1,172,229†

834,638†

625,901†

Ratio of management positions
held by women

%

—

—

—

2.7

16.3†

New hires

CO2 emissions*2

Renewable energy (electricity)
installation rate*3

2018

Non-Financial Data (Social)*1
2018

2019

2020

2021

719

749

772

805

2022

840

%

23.8

24.8

25.5

26.1

26.2

Persons

350

360

367

376

377

%

4.6

5.0

6.0

7.2

7.2

Persons

22

21

20

33

30

Ratio of women among
new graduate hires

%

36.4

33.3

25.0

30.3

33.3

%

1.87†

1.81†

1.75†

2.21†

2.33†

%

†

2.6

†

2.1

†

2.2

1.5

3.3†

Green building certificationacquisition ratio

%

40.7

36.6

38.3

56.4

62.5

Waste emissions*4

t

—

—

—

6,350†

6,429†

t/Thousand m3

—

—

—

5.3

5.3

Ratio of employees withdisabilities

60.9†

Voluntary turnover rate

Unit load

Unit

Persons†

Recycling rate

%

—

—

—

Water consumption*5

Thousand m3

—

—

—

688

786

Average annual training hours

Hours

12.0

14.4

12.2

18.3

15.8

Unit load (results)

m3/m2

—

—

—

0.70

0.79

Career training participation rate

%

100

100

100

100

100

Ratio of employees who
underwent a health check-up

%

100†

100†

100†

100†

100†

65.7†

*1 For detailed information and notes on each item, please refer to the Data section of the Sustainability Report.
(Sustainability Report 2023) Data (Environment) pp. 85-88*2 Scope of Collection: Tokyo Tatemono Group*3 Scope of Collection: Long-term buildings and commercial facilities over which Tokyo Tatemono has substantial energy management authority*4 Scope of Collection: Long-term buildings and commercial facilities over which Tokyo Tatemono has substantial energy management
authority and for which waste reuse/reduction plans have been submitted*5 Scope of Collection: Assets held in Tokyo Tatemono’s Commercial Properties Business† Indicates item verified by a third party
Material Issue KPIs and Targets p. 37

Health check reexamination rate

%

94.0

63.0

98.3

83.7

98.0

Smoking rate

%

22.5

21.0

17.2

16.0

12.1

Average number of paid leavedays taken per year*2

Days

9.9†

10.6†

9.3†

10.2†

11.8†

Average annual percentage ofpaid leave taken

%

—

57.7†

51.2†

57.5†

67.8†

Percentage of childcare leave
taken (men)*3%

35.3*5

4.8*5

18.2

13.0*550.0

Number of lost time injuries*

Unit

†

1

0

†

0

†

1†

1†

Total days lost due to absence

Days

137

†

†

122

7

†

†

386

646†

Ratio of absenteeism

%

—

0.06

0

0.18

0.28†

4

Non-Financial Data (Governance)*

†

†

†

*1 For detailed information and notes on each item, please refer to the Data section of the Sustainability Report.

(Tokyo Tatemono, Non-Consolidated)

Unit

2018

2019

2020

2021

2022

Number of reports and consultations
to the helpline(Sustainability Report 2023) Data (Social) pp. 88-91

Unit

59

56

41

61

52

*2 Days granted under other leave systems, such as summer leave and the founding anniversary, are not included in the above figures.

Number of incidents related to bribery Unit

0

0

0

0

0

Number of incidents related to antitrust or anti-competitive behavior*3 Percentage of male employees taking childcare leave = total number of male employees who took childcare leave in the relevant year/
total number of male employees who had a child born in the relevant year.

Unit

0

0

0

0

0

Number of incidents related to othercompliance violations

Unit

0

0

0

0

0

*4 Number of lost time injuries: Accidents that occur during work that result in one or more days absence.
*5 We revised the figures after conducting a detailed analysis.
† Indicates item verified by a third party* For detailed information and notes on each item, please refer to the Data section of the Sustainability Report.
(Sustainability Report 2023) Data (Governance) pp. 92-93

The Tokyo TatemonoGroup’s Value
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The Tokyo TatemonoGroup’s Value
Creation and Vision

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Creation Initiatives

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Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

63

Financial Statements
Consolidated Balance Sheet(Million yen)

Assets

FY2021

FY2022Current assets
Cash and deposits

87,010Trade notes and accounts receivable

14,041——

14,334

Real estate for sale133,251

173,836

Real estate for sale in process

139,389

160,009

Real estate for development

71,57981,069Other

36,00440,934

Trade notes, accounts receivable and contract assets

Allowance for doubtful accounts
Total current assets

82,440(58)(93)

481,217552,531

Non-current assets
Property, plant and equipment
Buildings and structures

383,995

396,529

Accumulated depreciation(160,377)(174,775)

Buildings and structures, net

223,618

221,754Land

539,786

537,397

Construction in progress

38,53644,903Other

30,09831,198(18,788)(20,291)

Accumulated depreciation
Other, net
Total property, plant and equipment

11,30910,907813,251

814,963

128,730

130,042

1,162

1,716

Intangible assets
Leasehold interests in land
Goodwill
Other
Total intangible assets

986

887

130,880

132,646

128,586

128,701

8,128

3,638

Investments and other assets
Investment securities
Investments in silent partnerships
Long-term loans receivable

8458

Deferred tax assets

2,148

2,001

Leasehold and guarantee deposits

21,261

21,469Retirement benefit assets

2,215

1,151

Other

63,17062,673

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

(97)

(100)

225,421219,993

1,169,553

1,167,603

1,650,770

1,720,134(Million yen)

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

FY2021

FY2022

83,72640,000—13,849
11,094
10
945
2
30
26
4,500
58,316
212,502

52,04750,00010,00013,781
4,811
11
950
2
—
0
—
67,856
199,461

255,000
575,676
19,861
23,663190
94
78,381
12,955
19,07625,7081,010,607
1,223,109

245,000
630,520
17,64727,274259
98
78,08813,023
21,68430,236
1,063,834
1,263,296

92,451
66,587
166,356(439)
324,955

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

54,276(17)
34,9592,144
736
92,09910,605
427,661
1,650,770

50,332—
43,187
4,604(179)
97,945
10,843456,838
1,720,134

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
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Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

64

Financial Statements

Consolidated Statement of Income and Consolidated Statement of Comprehensive Income(Million yen)

Consolidated statement of income
Operating revenue
Operating costs
Operating gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Commission expenses-borrowing
Share of loss of entities accounted for using equity method
Bond issuance costs
Dividends paid on real estate specified joint enterprise law
Provision for loss on guarantees
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Gain on sale of investments in capital of subsidiaries and associates
Gain on liquidation of subsidiaries and associates
Gain on bargain purchase
Gain on step acquisitions
Total extraordinary income
Extraordinary losses
Loss on sale of non-current assets
Loss on retirement of non-current assets
Impairment losses
Loss on building reconstruction
Loss on sale of investment securities
Loss on valuation of investment securities
Loss on liquidation of subsidiaries and associates
Loss on COVID-19
Total extraordinary losses
Profit before income taxes
Income taxes—current
Income taxes—deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent*Losses associated with reconstruction plans for leased buildings

FY2021

FY2022

340,477
247,933
92,54333,75958,784349,940
248,452
101,488
37,00964,478

21
5,336
—
1,523
6,881

28
3,621
1,825
830
6,307

6,667
1,012
10,804
443
75
30
361
19,39546,270

6,094
862
—
—
94
—
202
7,254
63,531

7
8,804
1,538
367
—
—
10,719

726
50
—
—
870
12
1,659

3
208
273
—
2
138
—
129
754
56,234
20,231
64
20,29535,938972
34,9659139462
1,772*
—
50
6
—
2,440
62,75015,5803,086
18,66644,084
1,021
43,062(Million yen)

Consolidated statement of comprehensive income
ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities accounted for using equity
methodTotal other comprehensive income
Comprehensive income
Comprehensive income attributable toowners of parent
non-controlling interests

FY2021

FY202235,93844,084

(676)
253
617

(4,021)
118
(924)

2,766
2,960
38,8982,359(2,467)
41,61637,949949

40,680935

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

65

Financial Statements

Consolidated Statement of Cash Flows(Million yen)

(Million yen)

FY2021

FY2022

Profit before income taxes

56,23462,750

Proceeds from sale and redemption of investment securities

10,786

2,188

Depreciation

18,572

18,796

Purchase of investment securities(1,578)(5,604)Purchase of shares of subsidiaries resulting in change in scope of
consolidation(1,105)—

Cash flows from operating activities

273

462

Loss on building reconstruction

—

1,772

Amortization of goodwill

290

317

Gain on bargain purchase

—

(870)

Loss (gain) on step acquisitions

—

(12)

Proceeds from sale of shares of subsidiaries resulting in change in scope of
consolidation—

654

Purchase of investments in capital of subsidiaries and associates(2,871)—

Proceeds from redemption of investments in capital of subsidiaries andassociates

2,204

—

Proceeds from sales of investments in capital of subsidiaries and associates

7,643

—

10,804(1,825)

Increase (decrease) in allowance for doubtful accounts

1236

Increase (decrease) in provision for bonuses

(11)

5

Increase (decrease) in provision for bonuses for directors (and other officers)

(21)

(0)

Increase (decrease) in provision for share-based remuneration for directors(and other officers)

50

69

Proceeds from sale of non-current assets

Increase (decrease) in provision for retirement benefits for directors(and other officers)

17

4

Increase (decrease) in provision for loss on guarantees

30

(30)
(26)

Increase (decrease) in provision for environmental measures

FY2022

Cash flows from investing activities

Impairment losses

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

FY2021(1)

Payments for investments in silent partnerships

(73)

—

Proceeds from withdrawal of investments in silent partnerships

774

4,460

19

4,244

(19,386)(22,495)

Increase (decrease) in deposits received under real estate specified joint
enterprise law

2,693(1,892)Other, net(749)(2,759)(1,642)(21,204)

Purchase of non-current assets

Net cash provided by (used in) investing activities

Increase (decrease) in provision for loss on liquidation of subsidiaries andassociates

(275)

—

Increase (decrease) in retirement benefit liability

209

(198)

Interest and dividend income(5,358)(3,650)

Increase (decrease) in commercial paper

Interest expenses

6,667

6,094

Proceeds from long-term borrowings

33,500135,500

138

50

Repayments of long-term borrowings(68,814)(112,534)

Loss (gain) on sale of investment securities(8,802)(50)

Repayments of long-term accounts payable—other

(202)

(202)

Loss (gain) on sale of investments in capital of subsidiaries and associates(1,538)—Proceeds from issuance of bonds

50,000—Loss (gain) on liquidation of subsidiaries and associates

(367)

6

Redemption of bonds(20,000)—

Loss (gain) on sale and retirement of non-current assets

204

(577)

Decrease (increase) in trade receivables

(310)

(292)

Purchase of equity in silent partnerships of subsidiaries and associates not
resulting in change in scope of consolidation

—

(648)

2

0

(234)

(4)

(10,029)(11,700)

(596)

(708)

Loss (gain) on valuation of investment securities

Cash flows from financing activities
Net increase (decrease) in short-term borrowings

Decrease (increase) in inventories

3,467(65,006)

Proceeds from sale of treasury shares

Increase (decrease) in leasehold and guarantee deposits received(999)(1,885)Purchase of treasury shares

Increase (decrease) in trade payables

(47)

813

Dividends paid

Decrease (increase) in leasehold and guarantee deposits

807

(849)

Dividends paid to non-controlling interests

Increase (decrease) in deposits received

(380)

3,839

Proceeds from share issuance to non-controlling shareholders

Other, net

5,181(1,094)

Other, net

Subtotal

84,847

18,648Interest and dividends received

6,196

6,203

Effect of exchange rate change on cash and cash equivalents

Interest paid

(6,535)(6,101)

Net increase (decrease) in cash and cash equivalents

Income taxes refund (paid)(18,619)(22,083)

Net cash provided by (used in) operating activities

65,889(3,332)

Net cash provided by (used in) financing activities

(0)

(0)

(15,000)

10,000

—

34

(811)

(1,312)(32,187)

18,421303

1,545

32,362(4,569)Cash and cash equivalents at beginning of period

54,64587,008Cash and cash equivalents at end of period

87,00882,439

The Tokyo TatemonoGroup’s Value
Creation Story

The Tokyo TatemonoGroup’s Value
Creation and Vision

The Tokyo TatemonoGroup’s Value
Creation Initiatives

The Tokyo TatemonoGroup’s Value
Creation Foundations

Data Section

TOKYO TATEMONO GROUP INTEGRATED REPORT 2023

Corporate Data

Company NameTokyo Tatemono Co., Ltd.

Established

October 1, 1896

Capital92.4 billion yen(As of December 31, 2022)

Representative

Hitoshi Nomura
Representative Director
President and Chief Executive Officer

Number of Consolidated
Employees

5,878(As of December 31, 2022)

Head Office

Tokyo Tatemono Yaesu Building
1-4-16 Yaesu, Chuo-ku, Tokyo 103-8285

Group Companies
Commercial Properties BusinessTokyo Fudosan Kanri Co., Ltd.
Tokyo Building Service Co., Ltd.
Shinjuku Center Building Management Co., Ltd.
Seishin Service Co., Ltd.
PRIME PLACE Co., Ltd.
EXPERT OFFICE Co., Ltd.
Residential BusinessTokyo Tatemono Amenity Support Co., Ltd.
E-State Online Co., Ltd.

Phone: 03-3274-0111

Asset Service BusinessTokyo Tatemono Real Estate Sales Co., Ltd.
Japan Rental Guaranty Co., Ltd.
Nihon Parking Corporation
Parking Support Center Corporation

Stock Listing

Prime Market of Tokyo Stock Exchange

Other Businesses

Listing Date

September 1907

Securities Code8804

Trading Unit

100 shares

Number of Shares
Authorized

400,000,000 shares

Number of Shares Issued
and Outstanding

209,167,674 shares(As of December 31, 2022)

Please refer to the following for more information.

Financial Information
Investor Relations
https://tatemono.com/english/ir/

IR Libraryhttps://tatemono.com/english/ir/library/

Overseas BusinessTokyo Tatemono (Shanghai) Real Estate Consulting Co., Ltd.
Tokyo Tatemono Asia Pte. Ltd.
Fund BusinessTokyo Tatemono Investment Advisors Co., Ltd.
Tokyo Realty Investment Management, Inc.

Non-Financial Information

Leisure and Child Care BusinessTokyo Tatemono Resort Co., Ltd.
Tokyo Tatemono Staffing Co., Ltd.

Sustainability
https://tatemono.com/csr/english/

Stock Price
(Yen)
2,500
2,000

Sustainability Report 2023
https://tatemono.com/csr/english/reports/

1,500
1,000
500
0

2020

2021

2022

Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

66