Aeon Reit Investment Corp.TSE: 3292

Semi-Annual Report for the Fiscal Period Ended January 31, 2025

May 22, 2025 at 5:12 AM UTC · Issued by AEON REIT Investment Corp.

AEON REIT Investment Corporation

https://www.aeon-jreit.co.jp/en/index.html

24th Period

Semi-Annual Report

For the fiscal period ended January 31, 2025

AEON REIT invests primarily in retail and related properties* that form the backbone of local communities.

Retail and related properties are an integral part of the communities in which they are located. We believe that these properties and facilities in which we invest form the backbone of local communities and their retail business infrastructure.

We also aim to ensure stable income and achieve steady portfolio growth over the medium-to-long term by investing in retail and related properties that contribute to the betterment of individual lives and local communities.

*Refers to retail facilities, logistics facilities and related facilities. Retail facilities refers to facilities containing retail businesses and other merchandising businesses, entertainment and amusement facilities and other facilities that attract customers (including parking lots and equipment and systems for logistics). Logistics facilities refers to warehouses and other storage facilities for distribution and transport of merchandise and other goods.

Contents

AEON REIT Characteristics 2

Financial Section (Audited)

AEON MALL Kurashiki

To Our Unitholders 4

Environmental Certification and Assessment 7

Financial Highlights 8

AEON REIT as Seen through the Numbers 9

Financial Strategy / Risk Management 10

Growth Strategy 12

AEON REIT's Portfolio 15

Strong Fundamentals 16

Effective and Efficient Financial Management 16

Highly Transparent Management Structure 18

Investment Policy / Distribution Policy 22

Management's Discussion and Analysis 38

Balance Sheets 54

Statements of Income 56

Statements of Changes in Net Assets 57

Statements of Cash Distributions 60

Statements of Cash Flows 62

Additional Information 63

Notes to Financial Statements 64

Supplemental Schedules 91

Independent Auditor's Report 105

Structure and Formation of Investment Corporation / Profile of the Asset Manager 108

Investor Information 109

AEON REIT Characteristics

We invest primarily in the retail properties of the AEON Group.

Investment Focused on Large-Scale Retail Properties

We invest primarily in retail properties that are an integral part of the communities in which they are located. In this asset class, we are structuring a portfolio of large-scale retail properties that we expect to generate stable cash flow over the medium-to-long term.

Type			Investment Percentage*
			Domestic Real Estate	Overseas Real Estate
			85% or more	15% or less
Retail properties, etc.	Large-scale retail properties	Super regional shopping centers (SRSC)	80% or more
		Regional shopping centers (RSC)
		Community shopping centers (CSC)
	Other retail properties	Neighborhood shopping centers (NSC)	20% or less
		Supermarkets (SM)
	Logistics facilities		10% or less

Share of large-scale retail properties in our portfolio

93.5

Currently

*Investment percentage is calculated on an acquisition price basis.

(As of January 31, 2025)

Collaboration with the AEON Group for Stability and Growth

We maintain stability with long-term sources of earnings by investing in retail properties operated by the AEON Group, a leading retailer and developer of large-scale retail properties throughout Japan. We also leverage the AEON Group's retail property expertise to generate growth.

Stable Finances

Group

Consolidated operating revenue

Approx. ¥9.5 trillion AEON Group employees Approx. 600,000

(As of February 29, 2024)

Our conservative financial management is based on clear financial policies for target LTV and other matters. As a result, we have strong, stable relationships with financial institutions, primarily megabanks. We have also received a long-term issuer rating of AA from Japan Credit Rating Agency, Ltd.

Japan Credit Rating Agency, Ltd. long-term issuer rating

Highly Transparent Management

(Stable)

For asset acquisitions from the AEON Group or any other related-party transaction, the decision-making process includes a mechanism to incorporate the opinions of independent third parties having no relationship with the Aeon Group. This creates highly transparent management that ensures win-win relationships with both unitholders and the AEON Group. Please refer to page 18 for details.

Introduction of Cumulative Investment Unit Purchase Program

On May 1, 2014, we introduced a program that enables directors and employees of AEON REIT and the Asset Manager to acquire AEON REIT's investment units using a cumulative investment program through securities firms.

The program will help to further raise awareness toward enhancing the value of AEON REIT's investment unit price and improving business performance to provide greater financial motivation in line with the interests of unitholders.

AEON REIT Investment Corporation

Initiatives on Sustainability

AEON REIT cares about Environmental, Social and Governance (ESG) issues in all aspects of its operations and cooperates with its stakeholders for such purposes.

Sustainability Policy

Environmental Initiatives
1. In order to achieve the realization of a low-carbon society, work to continuously improve energy efficiency and reduce emissions of greenhouse gases through the use of renewal sources of energy.
2. Promote peaceful coexistence with the natural environment by paying consideration to the conservation of ecosystems, and through tree planting activities and other real estate management initiatives.
3. In order to achieve sustainable use of resources, work towards conservation and recycling of resources through the promotion of water saving and the 3Rs (Reduce, Reuse, Recycle) with regard to the use of resources.
4. Observe and conform to environmental-related laws and regulations, etc., and endeavor to prevent environmental pollution.
Cooperation with Stakeholders

By carrying out education and training with regard to environmental issues, endeavor to raise the environmental awareness of our corporate officers and to pay care and attention to the diversity and work-life balance of our employees.
By utilizing the total, comprehensive power of the AEON Group, endeavor to provide comfortable work environments to the employees of end tenants/associates as well as those of other partner companies, and work to build a sound and healthy cooperative relationships.
In order to facilitate the advancement of ESG initiatives across the entire supply chain for our real estate operations, endeavor to implement a green procurement strategy.
Provide support for volunteer activities and places/opportunities for people from local communities to gather for educational and information exchanges, and endeavor to cooperate with communities as a hub for reconstruction efforts in times of disasters.
Proactively disclose information regarding ESG issues to investors and endeavor to communicate openly with them, and work continuously towards obtaining Green Building certification.

Establishment of Materiality (Key Issues)

AEON REIT has identified 14 topics as its materiality (key issues) regarding sustainability issues, and selected 8 of them as priority themes.

We have set KPIs for priority themes, and we are working to promote measures to achieve them.

Priority Themes

Environment

Opportunities in green buildings

Climate change

Biodiversity and land use

Social

Local community engagement and sustainable development

Safety and security of owned properties

Human capital development

Governance

Corporate governance

Compliance and risk management

TCFD Qualitative Analysis Disclosure

In August 2022, we add a climate change page to our website, where we disclosed our qualitative analysis in line with the TCFD recommendations.

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