April 26, 2022

Mid- to Long-term Business Plan

©︎Nomura Real Estate Holdings. All rights reserved.

(from FY23/3 to FY31/3)

Nomura Real Estate Group 2030 Vision

Nomura Real Estate Group has always connected closelywith customers’ lives and time, through real estate development
and real estate-related services.
Now, as we confront various social issues,
as well as diversified lifestyles and values,
we must change ourselves.
To enrich people’s respective lives and every moment of their time,
we will transform ourselves into a “Life & Time Developer”
that creates new, significant values on a global scale.

©︎Nomura Real Estate Holdings. All rights reserved.

2

Overall Concept
1.
2.
3.
4.
5.

Awareness of the Business Environment
Overall Concept
Evolution and Transformation of Value Creation
Financial Targets
Sustainability

Growth Targeted in the Plan
1.
2.
3.
4.

Growth Targeted in the Plan
Financial Strategy
Profit Plan
Shareholder Returns Policy

Measures Accelerating Growth
1. DX Promotion
2. Human Resources Utilization
3. Strategic Investment

Strategies by Business Unit
1.
2.
3.
4.
5.
6.

©︎Nomura Real Estate Holdings. All rights reserved.

Residential Development Business Unit
Commercial Real Estate Business Unit
Investment Management Business Unit
Property Brokerage & CRE Business Unit
Property & Facility Management Business Unit
Overseas Business Unit

3

Overall Concept
1.
2.
3.
4.
5.

©︎Nomura Real Estate Holdings. All rights reserved.

Awareness of the Business Environment
Overall Concept
Evolution and Transformation of Value Creation
Financial Targets
Sustainability

4

1. Awareness of the Business Environment
Achieved profit and financial targets set forth in Phase I of the previous Mid- to Long-Term Business Plan.
On the other hand, the business environment surrounding the Group is becoming increasingly complex and uncertain.
Business environment in focus

Response in the era with and after COVID-19

Advances in shrinking workforce, declining birthrate andaging of society

Diversification of lifestyles and work styles

Intensification of competition to obtain human resources

Accelerated evolution of digital technology

Increase in reconstruction needs such as aging of buildings

Changes in values on ownership and real place

Climate change and increased severity of disasters

Heightened awareness of sustainability

Increased geopolitical risks

Development of emerging economies

Increased volatility risk in the financial environment

The new Mid- to Long-Term Business Plan is formulated
to achieve sustained high profit growth in a changing business environment©︎Nomura Real Estate Holdings. All rights reserved.

5

2. Overall Concept(1) Evolve and transform approaches and methods of value creation to realize 2030 Vision of “Be a “Life & Time Developer,” as never seen
before”.
(2) Realize high profit growth, and high asset and capital efficiency. Achieve both high shareholder returns and high growth.
(3) Promote sustainability by viewing “the Group’s sustainable growth” and “contribution to a sustainable society” as an integral part.
(The Group management structure chart)<Our Group Vision>“New Value, Real Value”
Mid- to Long-term Business Plan

Promotion of Sustainability<Nomura Real Estate Group 2030 Vision><Sustainability Policy>

Evolve and transform value creationDX

Unique value creation
based on ourdevelopment capability

Sustainability

Pursuing humanity

Maintaining harmony
with nature

Building the future
togetherPriority issue for 2030 (Materiality)<Priority themes>
Realize high profit growth,and high asset and capital efficiency<Business strategy for growth>● Further expansion of domestic real estate development business● High profit growth in Service & Management Sector● Steady growth of overseas business©︎Nomura Real Estate Holdings. All rights reserved.

6

3. Evolution and Transformation of Value Creation

Evolve and transform approaches and methods of value creation to realize “ Be a “Life & Time Developer,” as never seen before”.

Nomura Real Estate Group 2030 Vision

Evolve and transform value creation approaches and methods
We will create new, significant values
to enrich people’s respective lives and every moment of their time.

Value creation through DX
Accumulate and analyze data throughutilizing digital technology for customer
contacts. Strengthen product capabilities andimprove service quality to provide newservices with high efficiency andconvenience.

©︎Nomura Real Estate Holdings. All rights reserved.

Unique value creation based on ourdevelopment capability

Value creation incorporating
sustainability

Based on our approach to connect closely withindividuals:(1) Build continuous and diverse customer
contacts through business collaboration andvalue chain within the Group(2) Develop brands across a wide range of asset
types(3) Provide new value in response to diversifying
lifestyles and values domestically andinternationally by leveraging our commitment toquality in terms of tangible and intangible
aspects

Position Diversity & inclusion, Human rights,
Decarbonization, Biodiversity and Circular
design as the priority issues to promote
Group’s sustainability, and implement themin our business activities

74. Financial Targets

Realize high profit growth, and high asset and capital efficiency. Achieve both high shareholder returns and high growth.
Business Profit
Realize annual average profit growth rate of 8% level

Business Profit

Phase I (FY 23/3 - FY 25/3)

Phase II (FY 26/3 - FY 28/3)

Phase III (FY 29/3 - FY 31/3)¥115.0 bn (FY 25/3)¥140.0 bn or more (FY 28/3)¥180.0 bn or more (FY 31/3)

Annual averagebusiness profit growth rate

8% level* Business profit = operating profit + share of profit (loss) of entities accounted for using equity method + amortization of intangible assets associated with corporate acquisitions

ROA/ROE
Pursuit of high asset and capital efficiency
Phase I

Phase II

Phase III

ROA

4.5% level

5% level

5% or more

ROE

9% level

10% level

10% or more

* ROA = Business profit / Average assets during the FY

Shareholder Returns Policy
Implement high shareholder returns
Phase I

Shareholders returns
policy©︎Nomura Real Estate Holdings. All rights reserved.

Total return ratio of 40-50%

Phase II

Phase III

Payout ratio at 40% level
85. Sustainability
Establish sustainability policy (vision of 2050). Set materiality as a priority issue to 2030.
Promote sustainability by viewing “the Group’s sustainable growth” and “contribution to sustainable society ” as an integral part.

Sustainability Policy

Pursuing humanity

Maintaining harmony with nature

Building the future together

Priority issue for 2030 (Materiality)
Society and employees
Diversity & inclusion

Climate change and natural environment

Human rights

Decarbonization

Biodiversity

Circular design

Targets and Initiatives in the Group<Strengthening promotion foundation><Reduction of total CO2 emissions by 2030 (Science Based Target : 35% reduction)>- Respect for the human rights of our employees and all people
involved in our business- Engagement with business partners based on the Nomura Real
Estate Group Human Rights Policy- Create an organization in which diverse personnel with a varietyof backgrounds and values can demonstrate their abilities- Initiatives aimed at co-creation of diverse organizations andhuman resources within and outside the company- Establish the Wellness and D&I Management Committee (Chair:Group CEO)- Establish the D&I Management Sect. in the Human Resources
Development Dept. as the dedicated management organization- Improve energy conservation performance in new buildings (ZEH/ZEB Oriented standards)- Implement renewable energy solar power plants in our development properties to achieve RE100(detached housing, Landport, etc.)- Initiatives for carbon neutrality through urban development such as Shibaura 1-chome Project- Promote use of low-carbon materials (timber-based buildings, etc.)- Initiatives to conserve biodiversity and absorb carbon dioxide through greening of urban areas andforest circulation activities, etc.
- Further efforts to develop products and services to realize a circular economy (building longevity,
waste reduction and recycling, etc.) such as “Attractive 30” for extending the cycle of large-scale
repair work.

©︎Nomura Real Estate Holdings. All rights reserved.

*Please refer to our sustainability website for KPIs for materiality and other details.

9Growth Targeted in the Plan
1.
2.
3.
4.

©︎Nomura Real Estate Holdings. All rights reserved.

Growth Targeted in the Plan
Financial Strategy
Profit Plan
Shareholder Returns Policy

101. Growth Targeted in the Plan

Realize annual average business profit growth rate of 8% level.

(¥bn)

Annual averagebusiness profit growth of
8% level

Actual business profit■本計画の事業利益目標
Business profit target under the plan
■事業利益実績

180.0 or more

140.0 or more

115.0
92.7
80.9

77.2

76.6

79.6

82.8

FY
16/3
FY16/3

FYFY17/3
17/3

FYFY18/3
18/3

FYFY19/3
19/3

FYFY20/3
20/3

76.4

FYFY21/3
21/3

FYFY22/3
22/3

FY 25/3
FY25/3

FY 28/3
FY28/3

FY 31/3
FY31/3* Business profit = operating profit + share of profit (loss) of entities accounted for using equity method + amortization of intangible assets associated with corporate acquisitions* Operating profit until FY 18/3, business profit from FY 19/3

©︎Nomura Real Estate Holdings. All rights reserved.

11

1. Growth Targeted in the Plan

Achieve both high shareholder returns and high profit growth of 8% level.

Image of cycle of profit growth and ROE in
Phase I of the previous plan

Growth Targeted in the plan
Capital efficiency
ROE: 10% or more
(Phase III)

Capitalefficiency
Shareholder returns

Capital efficiency in
FY 22/3 (ROE of 9% level)

ROE of 9% level(Phase I)

Shareholder returns
Total return ratio: 40-50%(Phase I)(total return ratio of 40-50%)

Profit growth

Financial leverage(profit growth rate of 4-5% level)(shareholders’ equity ratio of 30% level)

Increase ofinvestment
volumeProfit growthProfit growth rate of 8% level

Financial leverage(Shareholders’ equity ratio: 30% level)

Increase ofinvestment volume
Improve profitability to achieve
high level of ROA even during theinvestment expansion phase.

©︎Nomura Real Estate Holdings. All rights reserved.

122. Financial Strategy (1) Business Portfolio Strategy
Realize business expansion and increasing profitability through business collaboration and value chain within the Group originatingfrom development capability.
Aim for ROA of 5% or more through combination of businesses with different revenue structure and risk.
Real estate development capability based on company’s track record
Property Sales BusinessBusiness typeService Management Business
(4)

(1)
(1)

Businesscollaboration
Value chain(Legend)

Profit ability

Housingsales
Propertydevelopment for
sales

Overseas(2)

Business
BusinessvolumeBusinesscharacteristics(5)Expansion(3)(1) Improve profitability through reviewing targets of individual
projects(2) Expand business volume through developing overseas business(3) Increase business volume through the real estate development
capability

Investment
Management
Property
Brokerage & CRE
Property & Facility
Management(6)(5)Expansion
Leasing(7)(5)(4) Improve profitability by strengthening proposal capability
Enhance productivity through DX(5) Increase business stocks associated with stable supply(6) Improve profitability in leasing assets
portfolio by strategic replacement ofleasing assets(7) Increase business volume through thereal estate development capability

Overseas property sales

Domestic property sales

Property brokerage & CRE

Investment management /property & facility
management

LeasingMedium-high risk forinvestment
High risk of revenue
fluctuation

Medium risk forinvestment
High risk of revenue
fluctuation

Low risk for investment
Medium-low risk ofrevenue fluctuation

Low risk for investment
Low risk of revenue
fluctuation

Medium risk for investment
Low risk of revenue fluctuation

ROA (medium)
ROA target

Leasing Business

By improving profitability, this business willachieve a high level of ROA even when
expanding investment.

©︎Nomura Real Estate Holdings. All rights reserved.

ROA (high)

ROA (low)

Aim for stable revenue (low risk of revenue fluctuation) with ROA of 5% or morethrough profit growth of service management and improvement of profit rate ofleasing asset portfolio
13

2. Financial Strategy (2) Leasing Asset Portfolio Strategy
Realize of a certain amount of unrealized gain through the sale of properties with relatively low competitiveness in the mid to long term.
Improve leasing asset portfolio due to an increase in highly competitive properties by redevelopment and rebuilding.

Execute of property sales of a certain volume at appropriate timing after redevelopment or rebuilding.

Sale

Property forsales

Leasing
property held

©︎Nomura Real Estate Holdings. All rights reserved.

Sale

Realization of
unrealized gain
through property
sales

Investment
and recovery

Property
replacement at
appropriate timing

Realization of
unrealized gain
throughproperty sales

Redevelopment andrebuilding
Maintaining andimproving asset value

Highly competitive
properties (after
redevelopment andreconstruction)

Property replacement at
appropriate timing

14

2. Financial Strategy (3) Investment and Recovery Strategy

Expanding net investment as well as maintaining and improving ROA and ROE for high profit growth.
Units: billion yen

Phase I(FY 23/3 - FY 25/3)

Phase II(FY 26/3 - FY 28/3)

Phase III(FY 29/3 - FY 31/3)

Total

Residential Development
Investment

850

850

900

2,600

Recovery

800

850

900

2,550

Investment

700

800

1,000

2,500

Recovery

450

700

850

2,000

Investment

150

200

200

550

Recovery

50

150

200

400

Investment

1,700

1,850

2,100

5,650

Recovery

1,300

1,700

1,950

4,950

400

150

150

700

Commercial Real Estate,
Overseas

Total

Net investment*Figures in the table are rounded to the nearest of 50.0 billion yen.
©︎Nomura Real Estate Holdings. All rights reserved.

15

3. Profit Plan (1) Profit Target- Further expansion of domestic real estate development business (Residential Development, Commercial Real Estate)- High profit growth of Service & Management Sector (Investment Management, Property Brokerage & CRE, Property & Facility Management)- Steady growth of overseas business
Financial Targets

FY 22/3

Phase I

Phase II

Phase III

Business Profit *1¥92.7 bn

¥115.0bn (FY 25/3)¥140.0 bn or more (FY 28/3)¥180.0 bn or more (FY 31/3)

ROA/ROE

4.7％ / 9.2％

4.5% level / 9% level

5% level / 10% level

5% or more / 10% or more

Business Profit by Business Unit (¥bn)
Residential Development
Business Unit

32.5

32.5

Commercial Real EstateBusiness Unit

38.5

55.0

Investment Management
Business Unit

7.8

9.0

Property Brokerage & CRE
Business Unit

11.7

12.0

Property & Facility
Management Business Unit

9.2

10.5

Overseas Business Unit

0.2

4.0

Other and Adjustment

-7.4

-8.0

Domestic
real estatedevelopment
business

Service &Management
SectorPhase I (FY 25/3)
FY 22/3 (Actual)

92.7
Overseas

0.2

Commercial Real Estate

38.5

115.0
4.0

Phase III (FY 31/3)

180.0 or more
Phase II (FY 28/3)

140.0 or more

*2
Composition(%)
10％

Composition*2
(%)
3％

40％

55.0

45％

20％

Residential Development
Investment Management
Property Brokerage & CRE
Property & Facility Management
Other and Adjustment
Property Sales
Bisiness Profit Composition
by Business Type

LeasingService Management©︎Nomura Real Estate Holdings. All rights reserved.

32.5

32.5

7.8
11.7
9.2
-7.4

9.0
12.0

57%
19%
25%

approx. 60％

26％

30％

25％

10.5
-8.0

approx. 15％
approx. 25％

approx. 55％
approx. 15％
approx. 30％

approx. 55％
approx. 15％
approx. 30％*1. Business profit = operating profit + share of profit (loss) of entities accounted for using equity method + amortization of intangible assets associated with corporate acquisitions*2. Percentage of each Business Unit’s profit is calculated based on the projected business profit, excluding other and adjustments.

16

3. Profit Plan (2) Profit Growth Roadmap
Achieve the targets of profit plan in Phase I with sufficient land stocks. Aim to realize profits from Phase II.
Phase III¥180.0 bn or more
Phase II

¥140.0 bn or more
Phase I

¥115.0 bn

Profit contribution of housing sales business
Vietnam, Philippines, Thailand, China, etc.

Profit contribution centered on the housing
sales business in Vietnam

Overseas

Expansion of investment volume in property for
sales

Profit contribution of property for sales
business
UK and newly entered countries
Land bank rate 40 to 70％

Land bank rate around 100%Commercial
Real
EstateProfit contribution
of Federal Land
NRE Global, Inc.

Operation starts in large scale mixed-use development projects such as the Shibaura
1-chome Project and the Nihonbashi 1-chome Central District

Stable creation of development profit(gross profit of property for sales exceeding 30.0
billion yen in each fiscal year)

Further generation of development profit ( 40.0 billion yen level in each fiscal year)
Realization of unrealized gain through leasing asset portfolio replacement

Expansion of investment volume in property for
sales
Land bank rate around 100%

Profit contribution of projects after reviewing investment targets
Land bank rate 50 to 60％
Profit contribution of projects after reviewing investment targets

Resident
ial
Development

Stable supply of 4,000-5,000 units in housing sales businessLand bank rate around 100%

Land bank rate 30 to 50％
Generation of stable gross profit of sales of rental housing of around 2.0-3.0 billion yen

Steady accumulation of business stock

Service&
Management

Investment Management: In addition to REITs, strengthen private fund business. Increase assets under management.
Property Brokerage & CRE: Acquire real estate brokerage needs through collaboration with the Nomura Group and realize high efficiency and productivity through DX.
Property & Facility Management: Reduction of management costs through DX investment, and expansion of construction ordered utilizing data©︎Nomura Real Estate Holdings. All rights reserved.

17

4. Shareholder Returns Policy

Shareholder Returns Policy
Return the results of high profit growth to shareholders. Increase payout ratio toward Phase II.
Phase I(FY 23/3 - FY 25/3)

Phase II/III(FY 26/3 - FY 31/3)

Total return ratio of 40-50%

Payout ratio at 40% level

300.0

80

250.0

70
Dividend per share (yen)Payout ratio (%)

Total return ratio (%)

Phase III
200.0

60

Phase II
50.8
150.0

46.3

Phase I
45.0

50

44.3

41.4
97.5

100.0
57.5

65.0

70.0

75.0

80.0

40

82.5
35.5

50.0
29.1

23.3

30.5

29.9

FY19/3

FY20/330

31.7

Gradually increase payout ratio

26.5
0.0

20
FY16/3

FY17/3

FY18/3©︎Nomura Real Estate Holdings. All rights reserved.

FY21/3

FY22/3

FY23/3(Plan)

FY24/3

FY25/3

FY26/3

FY27/3

FY28/3

FY29/3

FY30/3

FY31/318

Measures Accelerating Growth
1.
2.
3.

©︎Nomura Real Estate Holdings. All rights reserved.

DX Promotion
Human Resources Utilization
Strategic Investment

19

1. DX Promotion

Utilize digital technology to create new value.
1) Invest in areas utilizing the Company’s strengths

Value creation through the utilization of digital technology(realization of digital dream)- Promote investment in areas utilizing strengths such as the platform service
utilizing the Company’s customer base.
- Seek areas capable of exhibiting strengths through an R&D approach2) Respond with a view to changes in society- Respond to essential themes to address in the trend of digitalization in society (MaaS as
an extension of services related to housing, expansion into e-commerce, etc.)- Promote productivity improvement in each business through digital technology

Investment themes- Shared-ride bus
reservations- Robot delivery(Retail facility toresidential)- Remotemonitoring- Visualization ofpower
consumption

MaaS

New areas(IoT services,etc.)- Cloud infrastructure- Customer data

- Contribute to everyday QOL of customers through the provision of services
centered on “people”- Accumulate and analyze data from customer base, and continue to improveand enhance products and services- Contribute to growth of each business through improvement of productivity

Platform service utilizing the Company’s customer base
EC website creation⇒ Home remodeling⇒ Interior design⇒ Shopping centers, hotels,
sports clubs

Customerengagement
EC

Smart
technology(smart apps,
utilization ofLINE,
digitalization)

Strengthen product byusing digital data

Increase in the- Shared officenumber of Enhancement of
space searchloyalty brandservicemembers
Customer base
- AI application in
brokerage
Smart search
Creation of- Metaverse
opportunities tolearn about services

Establishment
and utilizationof data©︎Nomura Real Estate Holdings. All rights reserved.

Productivity
Improvement- RPA- AI tools- Various business systems

Increase of sales of products andservices
Increase of surplus forinvestment

Provision of new services
with high efficiency andconvenience

Improvement ofservice quality
through feedback
Strengthen
Initiatives toimprove QOL
including service
expansion

Investment in
improvement of productivity
realizing cost reductions20

2. Human Resources Utilization

Realize a company that continues to provide satisfaction to employees and embrace challenges through the cycle of “success ofdiverse human resources” and “human resources retention in growth areas”.

Realization of a company that continues to provide satisfaction to employees and embrace challenges
challenges
Success of diverse humanresources

Realize wellness
that each
employee working
with vigor

Promote diversity andinclusion to enable adiverse workforce- Grow to a corporate group that contributes togrowth and rewarding for employees.
- Cultivate management personnel and leadershippersonnel that draw out diverse capabilities of each
employee- Introduce re-skilling, in which each employee
voluntarily develops his or her own potential- Establish a working environment that maximizes
the potential of diverse personnel with a variety ofbackgrounds and values such as women, seniors,
LGBTQ, people with disabilities, and foreign
nationals through the promotion of diversity
management training- Support the balance of work and childbirth,childcare, nursing care, injury and illness, andraising awareness aimed at shortening working
hours

Human resources retention in
growth areas

Retain and foster
human resources in theDevelopment Sector
that is the starting
point for growth- Obtain personnel with a high level of expertise inmulti-use, redevelopment and architecture bystrengthening recruitment- Distribute resources to growth areas throughpersonnel exchanges within the Group- Cultivate global personnel- Recruit and cultivate national staff in countries
where the Group operates

Allocate personnel tofocus areas of theService & Management
SectorImprove productivity through the acquisition andcultivation of DX personnel in the Group→ Allocate retained personnel to focus areas[Focus areas](Investment Management) Private fund business(Property Brokerage & CRE) Middle business*(Property & Facility Management) Construction
ordered business* Real estate brokerage for small and midsize companies, business owners,
some individual investors and high net worth individuals©︎Nomura Real Estate Holdings. All rights reserved.

21

3. Strategic Investment

Further accelerate the growth speed through the execution of strategic investment.

Investment targets

Service & Management Sector

Digital area

Overseas real estate

Accelerate growth speed⚫ Expand business opportunities and develop business into new areas⚫ Acquire external expertise and resources to response to changes in the social environment and diversification of customer needs⚫ Accelerate growth of existing business through the synergy creation©︎Nomura Real Estate Holdings. All rights reserved.

22

Strategies by Business Unit
1.
2.
3.
4.
5.
6.

©︎Nomura Real Estate Holdings. All rights reserved.

Residential Development Business Unit
Commercial Real Estate Business Unit
Investment Management Business Unit
Property Brokerage & CRE Business Unit
Property & Facility Management Business Unit
Overseas Business Unit23

1. Residential Development Business Unit

Contribute to the environment and society, as well as create new value by providing housings.
Business environment in focus
Changes in market sizedue to declining birthrate
and aging population

Changing lifestyles,
diversification of housing
needs

Financial targets (Phase I)
Residential
Development
Business Unit
26%

Heightened awareness ofsustainability and carbon
neutrality

Social needs for redevelopment
and reconstruction such as theregional activation, aging buildings,
and solving districts crowded withwood- frame housings

Growth strategy
Response to diversifying needs

Deepen and evolve PROUD
in housing sales business(Stable supply of 4,000 to 5,000 units)

Strengthen efforts inredevelopment andreconstruction projects

Monetization of non-asset businessBusiness profit ratio:
approx. 20% level(from Phase II)

Business profit¥32.5 bn
(FY 25/3)

General application ofbusiness methods utilizing
digital technology

Jingumae 6-chome Project

Nishiazabu 3-chome
Redevelopment

PROUD TOWER HigashiIkebukuro Station Arena

Building a platform for providing
living and housing services
Digital utilization for services incollaboration with Property &Facility Management Business Unit.

Continuous customer support structure
Sustainability

Competitive advantage
in ten years

DX promotion

Means promoting value
creation©︎Nomura Real Estate Holdings. All rights reserved.

Provide sustainable products
and services

Longer service life andenvironmental performance (ZEH
Oriented standards, etc.)/Reduction of total CO2 emissions

Transform sales methods
utilizing digital technology
Interact customers digitally,
optimize and improve
productivity of sales activities

Utilize digitaltechnologies in productplanning and quality
management

Smart locks, health tech, etc.

24

2. Commercial Real Estate Business Unit

Create value rooted in market changes and each customer’s usages, as well as realize development profit.
Business environment in focus
Changes in customer values
Emphasis on the individual,
The community, health,and the value of time

Heightened awareness ofsustainability and carbon
neutrality

Financial targets (Phase I)

Changes in employees’
awareness of work styles

Changes in purchase structure
Heightened needs for logistics
due to e-commerce andhubs due to acceleration of ediversification of salescommerce
channels

Growth strategy
Evolution and transformation of value creation linking
environmental changes to business opportunities
Facilitate changes in work styles
Office portfolio

Business profit¥55.0 bn
(FY 25/3)

Transformationof valuecreation
Promotion oflarge-scale
development

Realize development profit and unrealized profit(Gross profit of property for sales: Phase I over ¥30.0 bn,
from Phase II ¥40.0 bn level)

Acceleration of leasing value chain model
Expansion of investment volume in brandassets, Review of investment targets

Nihonbashi 1chome Central
District
Redevelopment

TOKYO TORANOMON GLOBAL SQUARE

Investment expansion in social
infrastructure

Improve customer engagement
by providing services forworkers

Highly functional logistics facilities,
data centers

Strategic asset replacement

Realization of unrealized gain, strengthening
leasing asset portfolio

Formulation of competitive asset and services
Commercial
Real EstateBusiness Unit
45%

©︎Nomura Real Estate Holdings. All rights reserved.

Contribution to a sustainable society
Switching electricity torenewable electricity for all
leasing properties

Standardization of ZEB
Oriented criteria

Build new services utilizing digitaltechnologies such as H¹T and retailproperties25

2. Commercial Real Estate Business Unit: Shibaura 1-chome Project

We will create a new future for people and society in this city open to the sky, the sea, and the world,. We will start a new Tokyo.
- A new work style TOKYO WORKation- Large-scale mixed-use development with grossfloor area of approx. 550,000 m2(Office, retail facility, hotel, housing)- Urban development utilizing waterfront location- Effectively zero CO2 emissions for the entire
district

Location: 1-1-1 Shibaura, Minato-ku, Tokyo
Size: S Tower: 43 floors above ground, 3 basement floors, approx. 235 m
N Tower: 45 floors above ground, 3 basement floors , approx. 235 m
Land area: approx. 40,000 m2
Gross floor area: approx. 550,000 m2
Main use: office, retail facility, hotel, housing
Start of construction: October 2021 (S Tower), FY 28/3 (N Tower)
Completion of construction: FY 25/3 (S Tower), FY 31/3 (N Tower)
Main participating companies: Nomura Real Estate Holdings, East Japan
Railway©︎Nomura Real Estate Holdings. All rights reserved.

26

3. Investment Management Business Unit

Utilize the leasing value chain to become Japan’s largest real estate investment company that is most trusted by investors interms of both quality and quantity.
Business environment in focus
Expansion of ESG investment

Financial targets (Phase I)

From traditional investment toalternative investment

Expansion of investment target
sectors(data centers, infrastructure sector,
etc.)

Globalization of real estate
investment management

Growth strategy
Sponsor (Nomura Real Estate Group)

Investment
Management
Business Unit 7%

Utilization of leasing value chain
REIT businessPrivate fund businessNew areas

Expansion of assets under management

Business profit¥9.0 bn(FY 25/3)

Core business to strengthen
revenue base
Maximize the leasing value chain

Capturing abundant
alternative investment
needs

Development of new
investor base and expansionof business areas

Expansion of product lineup meeting
diverse investor needs(hotels, healthcare, data centers, etc.)

Product development through collaboration
with the Nomura Group, research in newinvestment target sectors, M&A of overseas
asset managers

Enhancing fund operation capabilities©︎Nomura Real Estate Holdings. All rights reserved.

Sustainability initiatives

DX promotion

Promoting response to climate change as the industry’s top runner(Reduction of energy use and CO2 emissions)

Expansion of operations and improvement of
productivity with a view to diversification

27

4. Property Brokerage & CRE Business Unit

Become a professional group that is No. 1 in customer satisfaction and No. 1 in productivity by providing one-stop support for realestate demands and promoting DX.
Business environment in focus
Continuous expansion of theused real estate market

Financial targets (Phase I)

Increase of real estate needs
due to inheritance andbusiness succession

Increase of off-balance sheetneeds of general businesscorporations

Business profit¥12.0 bn
(FY 25/3)

Intensification of service
competition among major
companies
Rise of IT startups

Growth strategy*1

Property Brokerage &CRE Business Unit
10%

Increase in alternative
investment needs ofinstitutional investors*2*3

Retail business

Middle business

Wholesale business

Expansion of stable revenue basecapturing strong demand

Capturing needs related to M&A,
business succession and inheritanceneeds through collaboration withfinancial institutions and licensers

Promotion of CRE proposals based on
customer base, capturing investment
needs of funds

Individuals
with actual
demands

Commonstrategy

Individual
investors

Provide comprehensive services
Small- andmediumBusinesssizedownersenterprises

Investment
funds

Large
corporations- Strengthen collaboration with the Nomura Group to meet real estate brokerage needs- High efficiency and productivity utilizing digital technology- Creation of a positive cycle of improvement of employee and customer satisfaction

Improvement of productivity
and customer satisfaction through DX promotion

Utilization of digital technology©︎Nomura Real Estate Holdings. All rights reserved.

Promotion of digital contracting
Formulationof new sales methods

Establishment of systems to
improve productivity(Promotion of DX and BPO)

*１: Real estate brokerage business for individuals *２:Real estate brokerage business for small and midsize companies, business owners,
some individual investors and high net worth individuals *3 : Real estate brokerage business for large corporations, funds and overseas investors28

5. Property & Facility Management Business Unit

By utilizing digital technology, achieving both the provision of high-quality products and services, as well as labor saving. Pursuingcustomer satisfaction and competitive advantage.
Business environment in focus
Evolution of digital technology

Financial targets (Phase I)

Changes in lifestyles and work
Shrinking workforce
stylesDeclining birthrate and aging
Diversification of residentof society
attributes

Aging of buildings
Increase of smart buildings
Obsolescence of existingbuildings

Growth strategy
Property and facility management

Property & Facility
Management Business
Unit 9%Frequent occurrence ofdisasters
Strengthening of resilience

Construction ordered- Achieving both high quality and labor saving- Use of digital technology in services collaborated with the
Residential Development Business Unit
(Expansion of new areas into services providing individual
support)- Development of new products meeting customer needs- Development and deployment of competitive products such as
re:Premium- Proposals for construction combining technological capability
and proposal capability with data of customer characteristics

Transformation into a new business model utilizing digital technology

Business profit¥10.5 bn
(FY 25/3)©︎Nomura Real Estate Holdings. All rights reserved.

∞

Improvement of productivity through DX promotion
Standardization of operations through businessprocess reform
Injection surplus time and human resources into
customer service

Provision of services with high added value
Use of digital technology for customer contacts
Improvement of service quality throughaccumulation and analysis of data

Strengths of the Property & Facility Management
Business Unit

DX promotion

High quality service with hospitality

Business process reform

Technological capability and proposal capability meetingcustomer needs

Improvement of convenience

Branding power of No. 1 customer satisfaction

Utilization of data29

6. Overseas Business Unit

Utilize the expertise and knowledge developed in Japan to enrich housing, people’s lifestyles and time in other countries.
Business environment in focus
Further growth of the Asian housing market

Financial targets (Phase I)

Overseas Business
Unit 3%Heightened expectations in the resolution ofsocial issues through township development

Increased liquidity of the commercial property
sales market

Growth strategy
Housing sales business / commercial property sales business
Expand both business volume and quickly establish a revenue base
Aim for 15% or more of business profit to be generated from overseas business (Phase III)KAIZEN activities
Initiatives to improve quality through consortiums with Japanese and local companies

Business profit¥4.0 bn(FY 25/3)©︎Nomura Real Estate Holdings. All rights reserved.

Structure for maximizing value

Optimal operation according to customer needs, customs and theconstruction environment in each country
Introduction of advance technology
Utilization of venture capital, smart city initiatives

Housing research and study
Joint research with local universities

Know-how and expertise cultivated in Japan

Business promotion foundation

Our coherent approach to connect closely with eachcustomer regardless of business content

Consolidation of business promotion functions in local offices
Collaboration with local partner companies

Knowledge and expertise of housing sales business andcommercial property sales business

Formulation of governance systems
Monitoring through overseas monitoring meetings

30

Reflection on the Previous
Mid- to Long-term Business Plan (Phase I)©︎Nomura Real Estate Holdings. All rights reserved.

31

Reflection on the Previous Mid- to Long-term Business Plan
(Phase I)
Business profit was 92.7 billion yen in FY22/3, exceeding the profit target of 85.0 billion yen and marking the highest profit on record.
Profit Plan

Actual business profit

Annual average profit growth rate of 4-5 % level

Units: ¥bn

80.9
74.3

Business profit target under the previous plan (Phase I)

77.2

71.8

76.6

79.6

(¥ bn)

92.7

FY 22/3
Result

85.0

82.8
76.4

* Business profit = operating profit + share of profit (loss) of entities accounted for using equity method + amortization of
intangible assets associated with corporate acquisitions* Operating profit until FY 18/3, business profit from FY 19/3
©︎Nomura Real Estate Holdings. All rights reserved.

ChangeResidential Development
Business Unit

32.5

30.0

2.5

Commercial Real EstateBusiness Unit

38.5

33.0

5.5

Service & Management Sector

28.7

28.0

0.7

Investment Management
Business Unit

7.8

9.0

-1.1

Property Brokerage & CRE
Business Unit

11.7

11.0

0.7

Property & Facility
Management Business Unit

9.2

8.0

1.2

Overseas

0.2

-

0.2

Other and Adjustment

-7.4

-6.0

-1.4

92.7

85.0

7.7

FY14/3 FY15/3 FY16/3 FY17/3 FY18/3 FY19/3 FY20/3 FY21/3 FY22/3
Previous plan (Phase I)

FY 22/3
Previous plan

Business profit* The figures for the previous plan are before reclassification of the Overseas business.

32

Reflection on the Previous Mid- to Long-term Business Plan (Phase I)
Although ROA and ROE declined due to a drop in profit caused by COVID-19, targets were generally achieved.
Implemented steady increases in dividends and purchase of treasury shares, achieving the target total return ratio.
Financial and Capital Policy (Phase I)
Asset efficiency

Capital efficiency

Shareholder returns

ROA*: around 4-5 %ROE: around 8-9 %Total return ratio: around 40-50 %*ROA＝ Business profit / Average assets during the FY

5.5%

Dividends(left axis)

9.5%

9.2%

9.1%
9.0%

4.7%

4.7%

4.5%

75.0

8.5%

Payout ratio(right axis)

97.5

100.0

8.9%

5.0%

4.6%

Total return ratio(right axis)

80.0

100.0%

82.5

8.0%
50.0

7.5%

4.0%

4.1%

41.4%

46.3%

7.4%

45.0%
35.5%

7.0%

30.5%

3.5%

29.9%

50.0%

44.3%
31.7%

6.5%
3.0%

6.0%

FY19/3

FY20/3

FY21/3©︎Nomura Real Estate Holdings. All rights reserved.

FY22/30.0

FY19/3

FY20/3

FY21/3

FY22/30.0%

FY19/3 FY20/3 FY21/3 FY22/3
33

IR contact point
Nomura Real Estate Holdings, Inc.
Corporate Communication Dept.
TEL: +81-3-3348-8117
nrehd-ir@nomura-re.co.jp
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