Briefing Material for the ConsolidatedFinancial Results for the Six Months Ended September 30, 2025

2,350

160.00

120.00

5.8%

6.5%

118.37 127.14

6.3%

7.3% 7.7%

118.06

141.55

7.9%

10.0%

8.0%

2,000

1,291

1,728

1,511

2,060

1,834

1,222 1,315 1,410

1,728

1,419

1,978 1,893 2,040

80.00

3.4%

2.9%

4.7% 4.7% 5.2%

79.37

55.25 56.59 66.29

92.41 94.88

6.9%

6.0%

4.0%

1,000

1,077 1,157 1,189

1,400

1,595 1,635 1,667 1,755 1,767

40.00

2.6%

2.8%

2.8% 3.3% 3.2%

3.2% 3.1% 3.3%

3.2% 3.2%

2.0%

824 844

0

700 787

1,025 1,066

0.00

36.36 31.27

2.9%

2.8%

0.0%

FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE

Mar./14 Mar./15 Mar./16 Mar./17 Mar./18 Mar./19 Mar./20 Mar./21 Mar./22 Mar./23 Mar./24 Mar./25

FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE

Mar./14 Mar./15 Mar./16 Mar./17 Mar./18 Mar./19 Mar./20 Mar./21 Mar./22 Mar./23 Mar./24 Mar./25

(Billions of yen)

376.8

420.1

421.2

439.8

339.5

363.5

388.9

128.4

244.2

26.4

268.7 286.4

289.6

316.3

85.6

103.3

119.4

112.4

112.2

111.5 116.7

41.7 62.0 70.3

217.8 227.0 224.4 219.2

230.6

236.2

244.0

264.4

276.7

308.6 304.4 311.3

500

400

300

200

100

(Times)

29.0%

34.9%

31.0% 32.3% 33.3%

32.5% 31.6% 31.1% 31.7%

30.0%

30.9%

28.1% 28.5%

1.7

1.9

1.6

1.5

1.4

1.4

1.6

1.5

1.6

1.5

1.7

1.6

1.9

4.0

3.0

2.0

1.0

40.0%

30.0%

20.0%

10.0%

0

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

0.0

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

FYE

0.0%

Mar./14 Mar./15 Mar./16 Mar./17 Mar./18 Mar./19 Mar./20 Mar./21 Mar./22 Mar./23 Mar./24 Mar./25

Mar./14 Mar./15 Mar./16 Mar./17 Mar./18 Mar./19 Mar./20 Mar./21 Mar./22 Mar./23 Mar./24 Mar./25 Sep./25

*1 Net asset value per share is calculated as (net assets + after-tax unrealized gains on assets for leasing and other purposes) / number of shares issued excluding treasury shares.

*2 The Company executed a stock split at a ratio of two shares per share, effective July 1, 2025; therefore, the indicators stated reflect this stock split.

• Net sales are forecast to increase year on year, mainly as a result of an increase in revenue from sales of properties in the Building Business.

• Operating profit, ordinary profit, and profit attributable to owners of parent are forecast to increase year on year and expected to reach record highs. This is due to an increase in gain on sales of properties in the Building Business, and the recognition of gain on sale of investment securities resulting from the disposal of cross-shareholdings.

* The Company executed a stock split at a ratio of two shares per share, effective July 1, 2025; therefore, the indicators stated reflect this stock split.

Forecast of Consolidated Financial Results by Segment for the Fiscal Year Ending March 31, 2026

Year-on-year differences in segment results

• Building Business

  (Millions of yen)		Fiscal year ended March 31, 2025	Fiscal year ending March 31, 2026 (Expected)	Year on year	Year on year (%)	Main reasons for year-on-year differences in results
  Net sales		37,997	44,600	+6,602	+17.4	Leasing revenue is forecast to increase mainly on an increase in hotel revenues due to the opening of Caption by Hyatt Kabutocho Tokyo.
  	Leasing revenue	27,517	28,200	+682	+2.5
  	Revenue from sales of properties	8,965	14,900	+5,935	+66.2
  Other		1,514	1,500	(14)	(1.0)
  Operating profit		13,010	13,700	+689	+5.3	Revenue from sales of properties is forecast to increase due to an increase in sales of real estate for sale.
  	Gains on sales of properties	4,519	5,900	+1,380	+30.5	Leasing profit is forecast to decrease mainly due to a recording of opening costs of Caption by Hyatt Kabutocho Tokyo and a decrease of period revenue associated with sales of properties.

  • Leasing revenue

  • Increase in hotel revenues is expected to contribute about 0.9 billion yen to leasing revenue.

  • Revision of rent increase is expected to contribute about 0.1 billion yen to leasing revenue.

  • Contributions from properties acquired in the previous fiscal year are expected to boost leasing revenue by about 0.1 billion yen.

  • Reduced periodic revenues resulting from sales of properties, etc., are expected to reduce leasing revenue by about 0.4 billion yen.

  • Revenue from sales of properties

  • Leasing profit

  (Millions of yen)

  Fiscal year ended March 31, 2025

  Fiscal year ending March 31, 2026

  (Expected)

  Year on year

  Year on year (%)

  Main reasons for year-on-year differences in results

  • Asset management revenue and brokerage commissions are expected to

  grow stable.

• Asset Management Business

Through four growth strategies, we aim to enhance corporate value and achieve our vision for 2040.

Long-term Vision "WAY 2040"

1. Expand redevelopment business

Deploy Bazukuri endeavors that draw people in

throughout Japan

2. Cultivate profit growth while enhancing capital efficiency

Expand leasing business, promote reinvestment by realizing gains from property sales, and

Enhance enter new business areas

corporate

3. Boost social value

value through

synergies

4. Strengthen business foundations

Promote sustainability

initiatives

Maximize human capital

for accelerated growth

Four Growth Strategies

Quantitative Targets

Consolidated operating profit of at least 25 billion yen in 2040*1

Sustainable ROE*2 exceeding cost of shareholders' equity

Net-zero greenhouse gas (GHG) emissions by 2050

*1. More than double the consolidated operating profit target in the previous Medium-term Management Plan

*2. The ROE target is set for each Medium-term Management Plan.

Our Medium-term Management Plan, "WAY 2040 Stage 1," marks the period of our initial sprint toward dynamic growth.

This initial sprint toward dynamic growth is dedicated to establishing the Nihonbashi Kabutocho and Kayabacho district brand, undertaking our largest-ever redevelopment projects, located in Sapporo, and venturing into new business domains to realize our vision. This signals the beginning of our efforts to "Pursue perpetual dynamic growth to become the 'Bazukuri Company,'" the key goal of our Long-term Vision, "Way 2040."

Heiwa Real Estate Group Long-term Vision "WAY 2040"

Stage 1

Initial sprint toward dynamic growth (FY2024-FY2026)

Stage 2 Further evolution into

the "Bazukuri Company"

Becoming the "Bazukuri Company" capable of dynamic growth

FY2026

Consolidated operating profit

At least 14 billion yen

Earnings per share (EPS) At least 135 yen

-

Earnings per share (EPS) At least 150 yen

Quantitative Targets Expected

Return on equity (ROE)

(FY2024-FY2026)

At least 7%

Return on equity (ROE)

(FY2025-FY2026)

At least 8%

* These projections of profit levels and indicators represent estimates grounded in information available as of January 31, 2025, and incorporate specific premises and future outlooks. Please be aware that these figures are subject to change due to distributable amount regulations, other legal and regulatory requirements, and shifts in the operating environment. For further details, please refer to the announcement dated January 31, 2025 entitled, "Initiatives to Further Advance Management Conscious of the Cost of Capital and the Company's Stock Price." Please note that the Company executed a stock split at a ratio of two shares per share, effective July 1, 2025. Therefore, the EPS is stated with this stock split taken into consideration.

Elevating investment and sensibilities.

Bringing a new wave of dynamism.

The district where Eiichi Shibusawa and others opened the stock market is woven into the history at the heart of the Japanese economy.

To connect this district's trendsetting culture to the future, Nihonbashi Kabutocho and Kayabacho will transform investment and growth into a lifestyle.

Update the financial system and become Japan's premier investment city. Then become an even more expansive neighborhood.

Make investment more casual and the neighborhood more lively.

In a vibrant place where diverse individualities converge and creativity flourishes, chemical reactions generate innovations at all scales.

Let's create spaces together for enjoying business and leisure,

spreading globally unprecedented Bazukuri from this neighborhood that inspires sensibilities.

1. The 2040 Revitalization Vision for Nihonbashi Kabutocho and Kayabacho district

   • Building upon the district's evolution and changes in the external environment over the decade since the "Revitalization Vision for Nihonbashi Kabutocho" was announced in 2014, Heiwa Real Estate announced the "2040 Revitalization Vision for Nihonbashi Kabutocho and Kayabacho" in December 2024. This new vision seeks to further advance investment and lifestyles, fostering dynamic growth in the area.

   • Based on three concepts-"Japan's premier investment city," "a mixed-use district in which diverse individualities converge," and "a city that continuously gives rise to creativity and innovation"-the goal is to carry out Bazukuri that draws people in by revitalizing Nihonbashi Kabutocho and Kayabacho.

     [Reference] Changes in the external environment and

     the changes in the district since the previous vision was announced

     Changes in the external environment

     2015 Adoption of the SDGs by the United Nations

     Awareness of environmental and social issues increases

     2016 Formulation of the Vision for Tourism

     Continuous growth of inbound tourism in Japan

     2020 Spread of the COVID-19 pandemic

     Diversification and qualitative shifts in workstyles

     2023 Formulation of a plan to make Japan a leading nation in investment and asset management

     Acceleration of the shift from savings to investment

     Kabutocho

     Kabutocho

     A trendsetting neighborhood

     A hub for securities, finance, and investment

     Kabutocho

     A hub for financial startups and unique commercial establishments

     In the Meiji period, Eiichi Shibusawa founded Japan's first bank here. This site became ground zero of Japan's economic emergence, leading to the establishment of its stock exchange and numerous companies.

     Throughout the 20th century, active stock trading led to the neighborhood's development as a financial center, making it one of the world's three major stock markets.

     In 2014, the Revitalization Vision for Nihonbashi Kabutocho was announced with the theme of "creating a neighborhood where people gather and that gives rise to investment and growth."

     The Evolution of Nihonbashi Kabutocho and Kayabacho Over the Past Decade

     • Opening of KABUTO ONE, the neighborhood's landmark building

     • Establishment of five FinGate incubation facilities Attract approximately 100 financial startups

     • Attraction of 20 unique commercial establishments An increase in monthly visitors of approximately 5 times

     Nihonbashi Kabutocho and Kayabacho in 2040

     Elevating investment and sensibilities

     A city that continuously gives rise to creativity and innovation

     Bringing

     a new wave of dynamism

     Japan's premier investment city

     A mixed-use district in which diverse individualities converge

     Laying the groundwork to sustain the town's dynamism

     Walkable

     Sustainable

     DX

     
     
     

2. KABUTO ONE, a landmark building in the city (opened in August 2021)

   
   
   
   
   
   

   • The HEART, one of the world's largest cube-type LED displays, has been installed in the atrium on the first floor. The lower floors include KABUTO ONE HALL & CONFERENCE, a conference hall that offers investors and companies the opportunity to have dialogues; Book Lounge Kable, a library lounge; KABEAT, a large food hall; and KNAG, a community cafe.

     
     
     

   • Since its opening, KABUTO ONE has hosted finance and investment-related events, contributing to the prosperity and revitalization of the local community as a new landmark building in the city.

     KABUTO ONE Overview

     Location	7-1 Nihonbashi Kabutocho, Chuo-ku, Tokyo (residence indication)
     Access	Directly connected to Kayabacho Station on the Tokyo Metro Tozai Line and Hibiya Line
     Main Use	Office, shops, assembly hall, rental conference rooms, car parking
     Number of Floors	15 floors above ground, two floors below, two-story penthouse
     Construction	Steel construction above ground, SRC structure below (partial steel construction), mid-story isolation structure
     Total Floor Space	Approximately 39,208 m2 (approx. 11,860 tsubo)
     Operators	Heiwa Real Estate Co., Ltd., Yamatane Corporation, Chibagin Securities Co., Ltd.

     
     
     

3. KITOKI (completed in April 2022)

   
   
   

   • KITOKI, Heiwa Real Estate's first office building with retail stores that adopts a hybrid structure (wood and SRC) was completed in April 2022 and is operating with full occupancy.

   • KITOKI has been selected as a project by the Leading Projects Program for Sustainable Buildings for 2020 (led by wooden structure) by the Ministry of Land, Infrastructure, Transport and Tourism. The offices not only will use wood for the interior but also adopt a biophilic design* to prepare and offer an environment to offer even more comfortable working.

   • In appreciation for efforts to create possibilities for using wood in urban areas, KITOKI received the Good Design Award 2022, the Wood Design Award 2022, and the Good Facilities Using Wood Competition 2022-Award for Excellence. KITOKI also won the Grand Prize (Governor's Prize) in the Wood City TOKYO Model Architecture Award in 2023.

   KITOKI Overview

   Location	8-5 Nihonbashi Kabutocho, Chuo-ku, Tokyo
   Access	One minute walk from Kayabacho Station, on the Tokyo Metro Tozai Line
   Main Use	Shops/Office
   Number of Floors	10 floors above ground
   Construction	Wooden hybrid structure
   Total Floor Space	791.95 m2
   Design, Supervision and Construction	ADX Co., Ltd.

   
   
   
   
   
   

   * A method of spatial design based on the biophilia theory about the human psychological tendency to be closely associated with other forms of life, such as creatures

4. Caption by Hyatt Kabutocho Tokyo (opened in October 2025)

   
   
   
   
   
   

   • The Company has invited Caption by Hyatt, Hyatt's latest lifestyle hotel brand, to open the brand's first hotel in Tokyo.

   • It is a development project for a single-building hotel with wooden hybrid structure scheduled for completion in June 2025 and opening on October 7, 2025.

   • It has been selected as a project by the Leading Projects Program for Sustainable Buildings for 2022 (led by wooden structures) by the Ministry of Land, Infrastructure, Transport and Tourism, for the first time as an accommodation facility with wooden hybrid structure operated by a foreign hotel brand. Furthermore, it received the Director-General of the Forestry Agency Award at the 2025 Wood Utilization Promotion Contest.

     
     
     

     Caption by Hyatt Kabutocho Tokyo Overview

     Location	12 Nihonbashi Kabutocho, Chuo-ku, Tokyo
     Access	One minute walk from Kayabacho Station on the Tokyo Metro Tozai & Hibiya Lines Two-minute walk from Nihonbashi Station on the Tokyo Metro Ginza Line and Toei Asakusa Line
     Site Area	1,093.59 m2
     Total Floor Space	9,977.66 m2
     Number of Floors	12 floors above ground, one floor below, one-story penthouse
     Construction	Wooden hybrid structure
     Number of Guest Rooms	195 rooms

5. Nihonbashi Kayabacho 1-Chome District 6 Development Project (Provisional Name)

   
   
   

   • In October 2024, in collaboration with Mitsubishi Estate and Chuo-Nittochi Group Co., Ltd., the Company devised an urban planning proposal in Nihonbashi Kayabacho 1-Chome in Chuo-ku. The urban planning decision was announced on May 23, 2025.

   • Under this plan, the Company has proposed establishing a complex building that includes offices and other functions needed to form a commercial and financial base directly connected to Kayabacho Station of the Tokyo Metro Tozai Line/Hibiya Line and creating an open comprehensive space that serves as the center of a bustling community lush with greenery by expanding and redeveloping the shrine site on the premises.

   • The Company also aims to accumulate finance-related functions that will contribute to the realization of "Global Financial City: Tokyo" promoted by the Tokyo Metropolitan Government; to build a city inspired by the local cultural heritage and historical elements; to improve the area's disaster-prevention capabilities by developing a facility for commuters who may be unable to return home in the event of a disaster; and to design an urban space with greenery so as to contribute to enhancing Tokyo's international competitiveness and attractiveness.

     Overview of Nihonbashi Kayabacho 1-Chome District 6 Development Project (Provisional Name)

     Location	Part of 1-6 Nihonbashi Kayabacho, Chuo-ku, Tokyo
     Access	Directly connected to Kayabacho Station on the Tokyo Metro Tozai Line and Hibiya Line
     Site Area	Approximately 3,715 m2
     Total Floor Space	Approximately 41,650 m2
     Number of Floors/Height	27 floors above ground/3 floors below ground, about 140 m
     Main Use	Offices, shops, shrine, parking lot, etc.
     Schedule	Construction set to begin in FY2027, and to be completed in FY2030

     
     
     

6. Development of FinGATE (contribution to "Global Financial City: Tokyo" concept)

   • FinGATE has 108 corporate tenants as of the end of September 2025, including independent asset management companies and financial startups (mainly fintech-based). It maintains an occupancy rate close to 100% and has established itself as one of the largest concentrations of financial startups in Japan.

     「キャプション By Hyatt 兜町 東京」概要

   • As of September 2025, a total of six facilities have been equipped with infrastructure such as office and event spaces. Also, they provide support tailored to the growth stage of tenant companies and facility users, including creating opportunities for information dissemination, facilitating business matching, and supporting the introduction of middle-back services.

     Facilities at FinGATE

     Number of FinGATE tenants

     • Total number of lease agreements, coworking agreements, and shared-use agreements

     (FY)

     107 108

     91

     60

     64

     31

     42

     8

     26

     2017 2018 2019 2020 2021 2022 2023 2024 2025

     
     
     

7. Creating districts with diversity

   • Since the opening of K5 in February 2020, we have been working to update the district's atmosphere by combining new developments with renovations and by attracting unique and distinctive commercial tenants.

   • In 2025, urban wooden architecture like "prewood," which can be disassembled and relocated onto small plots of land, emerged in the district, further contributing to its evolution into a more diverse area.

Kabutocho Tokyo

A project aiming to develop urban wooden architecture that can be disassembled for future relocation onto narrow plots of land

This single-building hotel development project employs wooden hybrid structure. It also is the first to attract "Caption by Hyatt" to Tokyo. It has been selected as a project by the Leading Projects Program for Sustainable Buildings for 2022 (led by wooden structures).

1. Odori-nishi 4 South, Type 1 District Redevelopment Project

   
   
   
   
   
   

   • Construction of the new building began in October 2025. The Company aims to realize redevelopment suitable for this district, which is located in central urban Sapporo, by building high-function offices, etc. to help businesses enhance their competitive edge.

   • Park Hyatt, Hyatt's most luxurious hotel brand, has been selected to occupy the upper floors.

   • We invite Mr. Kengo Kuma, who is a world-class architect, to be the design supervisor.

   • The investment amount the Company plans to acquire as a participating member is expected to be approximately 120 billion yen.

Hotel overview

1. Odori-nishi 4 South, Type 1 District Redevelopment Project

   • Development Policies

     
     
     

     1. Creation of spaces that enhance the appeal of Odori as an exchange base
     2. Development of functions to enhance urban capabilities
     3. Development of functions that reduce environmental impact and contribute to disaster preparedness

     • Development of new gathering spaces and viewing areas with an atrium terrace that connects greenery areas

     • Expansion of the underground plaza that serves as an exchange base in Odori

     • Enhancement of the appeal of Odori Park (Nishi 4)

     • Improvement of the pedestrian environment above and below ground and creation of appeal

     • Development of high-functionality offices to strengthen the business competitiveness of central Sapporo

     • Development of luxury hotels equipped with lodging facilities that meet international standards

     • Development of a district heating and cooling plant with an eye toward constructing a new energy network extending to the south of Odori

     • Acquisition of an international certification (LEED), etc.

     • Development of facilities that can shelter stranded commuters and provide stockpile storage

     • In promoting the project, the Company plans to develop new gathering spaces and viewing areas with an atrium terrace that connects greenery areas and to construct a district heating and cooling plant with an eye toward building a new energy network extending to the south of Odori.

       (From right) Katsuhiro Akimoto, Mayor of Sapporo, and Kiyoyuki Tsuchimoto, Representative Executive Officer, President and CEO, Heiwa Real Estate Co., Ltd.

       • On October 22, 2025, Sapporo City and the Company signed a Cooperation Agreement to Strengthen the Financial Ecosystem.

       • We will build a cooperative relationship to strengthen Sapporo City's financial industry and promote the enhancement of the financial ecosystem and economic revitalization.

       [TOPICS] Signed a Cooperation Agreement to Strengthen the Financial Ecosystem with Sapporo City

1. Sapporo Station South Exit North 4 West 3, Type 1 District Redevelopment Project

• A property rights reallocation plan was approved in July 2024. Construction of the new building began in March 2025.

• The Company aims to transform the area into a symbol of the gateway to Hokkaido's capital, Sapporo, and to bring fresh vibrancy and excitement to the area, with a view to completing construction in July 2028.

Project overview

▼About 165 m

Office floors (some for accommodations)

About 60 m▼

Commercial floors

Commercial floors Parking lot, etc.

* The information above is based on the plan and image at the time this material was created and is subject to change based on future discussions and deliberations.

• Strengthen the hotel business to achieve the perpetual dynamic growth that the Company is pursuing as a key goal of its Long-term Vision.

  	In operation				Under development
  	Hotel Brighton City Osaka Kitahama	K5	Mercure Hotel Tokyo Hibiya	Caption by Hyatt Kabutocho Tokyo	Park Hyatt Sapporo
  Appearance		©K5
  Location	Kitahama, Chuo-ku, Osaka	Nihonbashi Kabutocho, Chuo-ku, Tokyo	Uchisaiwaicho, Chiyoda-ku, Tokyo	Nihonbashi Kabutocho, Chuo-ku, Tokyo	Odori-nishi, Chuo-ku, Sapporo
  Total Floor Space (Number of Rooms)	7,447 m2 (233)	2,066 m2 (per building) (20)	17,868 m2 (178)	9,977.66 m2 (195)	99,800 m2 (157 (plan))
  Completion Date	March 2008	1923	May 1989	June 2025	Scheduled to open in 2029
  Opening Date	Contract began in March 2008	February 2020	December 2023	October 2025	Scheduled to open in 2029
  Contract	Lease	Lease	Hotel management contract	Hotel management contract	Hotel management contract
  Operator	Brighton	FERMENT	Accor Group	Hyatt Group	Hyatt Group

  Shareholder Returns

• For shareholder returns from FY2024 to FY2026, the Company has adopted a basic policy of targeting a consolidated dividend payout ratio of approximately 50% and implementing flexible share buybacks.

• The Company projects an annual dividend per share of 88 yen for the fiscal year ending March 31, 2026 (73 yen in ordinary dividends and 15 yen in special dividends), marking nine consecutive periods of increases in ordinary dividends.

• The Company also plans to continue paying special dividends in the fiscal year ending March 31, 2027, marking four consecutive periods with special dividends.*

  Transition of Dividend Amount per Share (yen)*

100

90

80

70

60

50

40

30

20

10

0

Mar. 2017 Mar. 2018 Mar. 2019 Mar. 2020 Mar. 2021 Mar. 2022 Mar. 2023 Mar. 2024 Mar. 2025 Mar. 2026

Mar. 2027

60%

49.1% 50.2% 50.3%

40.6% 40.1% 40.9%

15

15

15

25

30.2% 30.3%

23.0%

24.9%

71

73

75

47.5

52

58

2

38.5

28

13

16.5

24

50%

40%

30%

20%

10%

0%

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

9,048

2,499

2,499

1,999

2,597 1,947

5,969 5,771 5,905

2,877

3,489

3,740

1,037

1,475

1,856

2,125

Mar. 2017 Mar. 2018 Mar. 2019 Mar. 2020 Mar. 2021 Mar. 2022 Mar. 2023 Mar. 2024 Mar. 2025 Mar. 2026

Dividend per share (Special dividend) Dividend per share (Ordinary dividend)

(Expected) (Forecast)

(Expected)

* The Company executed a stock split at a ratio of two shares per share, effective July 1, 2025; therefore, the amounts stated reflect this stock split.

• Based on the Heiwa Real Estate Group's Long-term Vision, "WAY 2040," and the new Medium-term Management Plan, "WAY 2040 Stage 1," we will promote management that is conscious of capital costs and the stock price to enhance corporate value.

  Our approach toward enhancing corporate value

EPS/ROE*

(Yen) 150.00

141.55

10.0%

100.00

7.9%

5.0%

50.00

0.00

0.0%

Mar. Mar. Mar. Mar. Mar. Mar. Mar. Mar. Mar. Mar. Mar. Mar. 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

EPS ROE

• • The Company is accelerating initiatives to reduce cross-shareholdings, aiming to halve the balance of approximately 17.5 billion yen as of the end of December 2024 by FY2026. (Reference: Consolidated net assets as of the end of December 2024: Approximately 114.1 billion yen)

  • For shareholder returns from FY2024 to FY2026, the Company will set the consolidated dividend payout ratio at 50%, with an eye on the cost of shareholders' equity and capital efficiency, etc. The Company will flexibly implement share buybacks, while comprehensively considering the stock price level, investment plans, financial conditions, etc.

    * The Company executed a stock split at a ratio of two shares per share, effective July 1, 2025; therefore, the amounts stated reflect this stock split.

    Conclusion of Capital and Business Alliance Agreement between Heiwa Real Estate Co., Ltd. and Taisei Corporation, and Establishment of Tripartite Collaborative Relationship including Mitsubishi Estate Co., Ltd.

• As part of its efforts to realize its Long-term Vision "WAY 2040," the Company concluded a capital and business alliance agreement with Taisei Corporation in June 2024 and a three-party agreement related to a capital and business alliance with Taisei Corporation and Mitsubishi Estate Co., Ltd.

• Through the Alliance, it is expected that establishing a medium-to long-term collaborative relationship will lead to greater corporate value for both companies. This will be achieved by further leveraging their respective strengths in business foundations, expertise, and other domains to

(1) expand and accelerate redevelopment business, (2) collaborate on new business areas such as investments in new real estate (asset classes), and (3) promote business alliances in the fields of sustainability and DX.

Business alliance with Taisei Corporation

1. Collaboration in redevelopment business, etc.

   • To facilitate the progress of medium- to long-term redevelopment business, the parties have agreed to establish and develop a collaborative relationship for redevelopment business in the Nihonbashi Kabutocho district, along with Mitsubishi Estate. They will also engage in sincere discussions to: a) examine and promote redevelopment business in Sapporo, b) establish a comprehensive cooperative relationship, including mutual provision of know-how related to redevelopment business as needed, and c) collaborate on redevelopment business that either or both may consider promoting in the future.

     (ii) Collaboration in new business fields such as new real estate investment

   • The Company aims to venture into new business fields to achieve the Group Long-term Vision, and the parties have agreed to actively collaborate on business alliances in new business fields such as investment in logistics facilities, a new asset class.

     (iii) Collaboration in sustainability and DX

   • The parties have agreed to actively collaborate on business alliances in the fields of sustainability and DX.

   • As an initiative based on the Company's capital and business alliance with Taisei Corporation (Taisei), the Company has entered the Private REIT Business. This was done by acquiring a portion of shares (equivalent to a 13.6% stock ownership ratio) in TREAM, which is a consolidated subsidiary of Taisei and the asset management company for the non-listed TCPR, effective March 10, 2025. This expands the Asset Management Business domain within our Group.

   • Additionally, the Company signed a sponsor support agreement with TCPR and TREAM on the same date, taking on a sub-sponsor role by offering them property information and other necessary support.

   • Furthermore, the Company made a same-boat investment as a sub-sponsor by acquiring new investment units issued by TCPR as of September 1, 2025, thereby contributing to TCPR's growth. In addition, TCPR will acquire a portion of our equity interest in the Sapporo Office that we sold by utilizing a bridge scheme by September 3, 2025, which will also contribute to TCPR's growth as a sub-sponsor.

   • This endeavor will serve to strengthen the Company's capital and business alliance with Taisei. In addition, by expanding the reinvestment by realizing gains from property sales-a key growth strategy in our Group's Long-term Vision-we seek to enhance corporate value.

* The Company has entered into a business alliance agreement with Heiwa Real Estate Asset Management Co., Ltd., which is a consolidated subsidiary of the Company and the asset management company for Heiwa Real Estate REIT, Inc. (HFR), a listed REIT for which the Company serves as the main sponsor. This sponsor support agreement stipulates that the Company will provide property information and other support so long as doing so does not conflict with the agreement's terms. Given that HFR will be prioritized in the provision of information on properties held or developed by the Group, there will be no change in the Company's role as the main sponsor of HFR.

Collaborative Business with Taisei Corporation

(Creation of a Nihonbashi Kabutocho and Kayabacho Digital Twin Prototype)

• Nihonbashi Kabutocho and Kayabacho Digital Twin Prototype Screen

  
  
  
  
  
  

  • The Company constructed a prototype of the Nihonbashi Kabutocho and Kayabacho Digital Twin in March 2025. This digital twin recreates the Nihonbashi Kabutocho and Kayabacho district in a virtual space, utilizing the next-generation district development tool "Shin Digital Twin" developed by Taisei Corporation.

    Aerial view of the Nihonbashi Kabutocho and Kayabacho district Future vision for the Kabutocho intersection*

• Nihonbashi Kabutocho and Kayabacho-Walk Around Town Video Game Screen Shots

• By constructing the Digital Twin, it is possible not only to visualize urban spaces in three dimensions but also to utilize it as a tool to promote various district development initiatives, including sophisticated simulations of urban spaces with three-dimensional information.

• In September 2025, the Company developed a game based on the Digital Twin prototype to inspire guests of Caption by Hyatt Kabutocho Tokyo and others to walk around the district and explore nearby sightseeing spots.

The Company aims to enhance the eagerness of tourists to explore the Nihonbashi Kabutocho and Kayabacho district through this initiative and other efforts.

Travelling inside a building in the game (Inside KABUTO ONE Atrium)

Travelling inside a building in the game (Inside K5)

* Detailed considerations are subject to change based on future deliberations and discussions by related organizations