Ticker symbol 8830
May 16, 2019
Sumitomo Realty & Development Co., Ltd.
2-4-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo
Kojun Nishima, President

NOTICE OF THE MEDIUM-TERM MANAGEMENT PLAN
Name: Eighth Medium-Term Management Plan

Plan period: Three years from April 2019 to March 2022

Key points
1. Performance targets
Achieve consecutive record results for the three-year period covered, with cumulative ordinary
profit of ¥700 billion.
Achieve record results for the ninth consecutive fiscal year under the three management plans since
the Sixth Management Plan by maintaining the pace of growth attained under the SeventhManagement Plan with which substantial profit increase was achieved.

<Three-year cumulative earnings targets>
Revenue from operations¥ 3,100 billion(+ ¥213.2 billion, + 7%)

Operating income¥ 740 billion(+ ¥125.8 billion, + 20%)

Ordinary profit¥ 700 billion(+ ¥141.2 billion, + 25%)

(Reference) Comparison of Management Plan results (Years ended/ending March 31)(Billions of yen)Management Plan

Revenue from operations

Operating income

Ordinary profit

5th Plan

6th Plan

7th Plan

8th Plan

2011-20132014-20162017-20192020-2022

2,170.0

2,442.0

2,886.83,100.0(+63.2)(+272.0)(+444.7)(+213.2)

437.2

500.6

614.2

740.0

(+2.3)(+63.3)(+113.6)(+125.8)

329.1

418.0

558.8

700.0

(-10.0)(+88.8)(+140.8)(+141.2)

Note: All figures are cumulative totals within the period of the plan.

-1-2. Leasing asset investment plan (Non-current asset investment excluding sales assets, such as
condominiums for sale)
Further investment in leasing office assets in central Tokyo, strengthening our earnings base.
1) Concrete development plan for over 800 thousand tsubo (one tsubo is roughly 3.3 m²) of gross floorarea, mainly comprising redevelopment projects.
(Equivalent to over 50% of 1,520 thousand tsubo of gross floor area for leasing as of the end of theSeventh Management Plan)

The total investment will amount to ¥2,000 billion, expected to generate profits within six to sevenyears.

2) During the Eighth Management Plan, approximately 30%, or 230 thousand tsubo, of total grossfloor area of the investment pipeline will be completed and brought to market.

Pace of development
Management Plan

5th Plan

6th Plan

7th Plan

8th Plan

Gross floor area (tsubo)

150,000

110,000

210,000

230,0003) Of ¥2,000 billion, ¥600 billion is expected to be invested in the next three years.
Funding will be covered by expanding cash flows from the leasing business*. (No increase in interestbearing debt expected.)<Capital investment and cash flows from the leasing business>(Billions of yen)Management Plan

5th Plan

6th Plan

7th Plan

8th PlanCapital investment(268.0)(422.3)(663.5)(600.0)Cash flows from the363.6

409.8

534.6

680.0

2,650.7

3,158.9

3,342.8

3,300.0

leasing business
Interest-bearing debt

*Cash flows from the leasing business: Operating income of the leasing business + Depreciation andamortization-2-3. Performance targets and strategies by segment
Office building leasing in Tokyo to be the driving force of growth.

<Performance targets by segment>(Billions of yen)Management Plan

5th Plan

6th Plan

7th Plan

8th Plan

Leasing

843.0

886.2

1,073.1

1,200.0

Sales

670.0

773.1

957.2

950.0

Construction

500.0

589.3

634.7

720.0

Brokerage

146.8

177.2

208.8

220.0

2,170.0

2,442.0

2,886.8

3,100.0

Leasing

272.1

313.7415.5

530.0

Sales

110.2

127.2

140.1

140.0

Construction

48.9

47.0

50.4

70.0

Brokerage

41.2

52.1

62.6

65.0

Operating income

437.2

500.6

614.2

740.0

Revenue from operations<Strategies>
1) Leasing
Profit growth of the Seventh Management Plan, supported by the buoyant market environment, to besurpassed.
 Profitability of existing properties, which improved on the back of lower vacancy rates and higher
rents, to be further strengthened.
 Earnings secured by full-year contribution from the properties completed in the SeventhManagement Plan (210 thousand tsubo of gross floor area) and by starting operation of newly
completed projects in the Eighth Management Plan (230 thousand tsubo of gross floor area).

2) SalesHigh level of profit of the Seventh Management Plan to be maintained.
 Marketing speed adjustment, following profit-pursuing policy rather than volume-pursuing policy.
 The policy of securing prime sites without fail amid continuing intensified competition for landacquisition, to be maintained.
 The policy of pursuing as many projects as possible when such opportunities arise, to be maintained.
3) Construction
Remodeling (Shinchiku Sokkurisan): Growth track, recovered in the Seventh Management Plan-3-following the sluggish period until the Sixth Management Plan, to be maintained.
Expansion in remodeling demand expected in a growing market, matching the Japanese government’s
policy of accumulating high-quality residential property stock.

Custom Homes: Business base to be strengthened through improvement of construction systems andquality control.
Annual contract volume expanded to 3,000 units in the Seventh Management Plan. Business base tobe reinforced for growth in the Ninth Management Plan onward.

4) BrokerageGroup collaboration to be strengthened, establishing the base for growth in the Ninth Management
Plan onward.
Efficiency of the brokerage business to be further improved, with Sumitomo Real Estate Sales Co.,
Ltd. becoming a wholly owned subsidiary in the Seventh Management Plan.

4. Policy for shareholder returns“Sustainable dividend increase” policy, in line with profit growth, to be maintained.
Cash flow allocation policy of prioritizing investment in office properties for lease, to be maintained.

<Dividends and earnings per share>(Yen)
Management Plan
(Years ended March 31)

6th Plan2014

2015

7th Plan2016

201720182019

Dividends

20

21

22

24

27

30

Earnings per share

147

170

185

218

253

276-4-