Supplementary Information for the Report on Consolidated Financial Results for the Three Months Ended June 30, 2025

‌Supplementary Information for the Report on Consolidated Financial Results for the Three Months Ended June 30, 2025

July 31, 2025

‌Highlights During the Three Months Ended June 30, 2025

• In the first quarter of the fiscal year ending March 31, 2026, the consolidated financial results show increases in net sales, operating profit, and ordinary profit compared with the same period of the previous fiscal year due to increased sales of properties in the Building Business and the rise in earnings from the operations of the hotel, etc.

  ＜Progress of Gains on Sales in Properties＞

• Profit attributable to owners of parent also increased compared with the same period of

  【Fiscal year ended March 31, 2025】

  【Fiscal year ending March 31, 2026】

  the previous fiscal year due to the reason described above as well as the recognition of

  % indicates the progress rate against the quarterly plan.

  103%

  gain on sale of investment securities resulting from the reduction of cross-shareholdings.

• In conjunction with the public offering of Heiwa Real Estate REIT, Inc. (for the fifth consecutive year), growth will be supported through property sales, thereby contributing to the expansion of the group's revenue.

• The hotel development project "Caption by Hyatt Kabutocho Tokyo" (with a total of 195 rooms) in Nihonbashi Kabutocho and Kayabacho was completed on June 30, 2025, and it is scheduled to open on October 7, 2025.

• The urban planning decision for the "Nihonbashi Kayabacho 1-Chome 6 District Development Plan" (tentative name) was made on May 23, 2025.

• With the purpose of expanding the investor base, Heiwa Real Estate Co., Ltd. (the "Company") conducted a 2-for-1 stock split effective from July 1, 2025.

• Following last year, the Company has been selected as constituent stocks of all ESG indices used by the GPIF (Government Pension Investment Fund) for investment.

  100%

  100%

  1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q
  	Plan	Actual			Plan	Actual

  ‌Consolidated Financial Results for the Three Months Ended June 30, 2025

  • Net sales, operating profit, and ordinary profit were increased compared with the same period of the previous fiscal year mainly due to increased sales of properties in the Building Business and the rise in earnings from the operations of the hotel, etc.

  • Profit attributable to owners of parent also increased compared with the same period of the previous fiscal year due to the reason described above as well as the recognition of gain on sale of investment securities resulting from the reduction of cross-shareholdings.

    (Millions of yen)		Three months ended June 30, 2024	Three months ended June 30, 2025	Year on year	Year on year (%)	Full-year forecast for the fiscal year ending March 31, 2026*1	Progress against full-year forecast*1 (%)
    Net sales		10,579	13,123	+2,544	+24.0	49,000	26.8
    	Building Business	9,879	12,419	+2,539	+25.7	44,600	27.8
    	Asset Management Business	699	703	+4	+0.6	4,400	16.0
    Operating profit		2,961	3,438	+477	+16.1	13,900	24.7
    	Building Business	3,159	3,657	+498	+15.8	13,700	26.7
    	Asset Management Business	315	318	+3	+1.1	2,500	12.8
    	Intersegment eliminations	(513)	(537)	(24)	-	(2,300)	-
    Ordinary profit		2,739	3,114	+374	+13.7	11,700	26.6
    Extraordinary income		-	519	+519	-
    Extraordinary losses		4	2	(1)	(42.3)
    Profit attributable to owners of parent		2,093	2,258	+165	+7.9	9,700	23.3
    Earnings per share (EPS) (yen)*2		29.91	33.83	+3.92	+13.1	145.22	23.3

    *1 Announced on April 30, 2025

    *2 Since the Company conducted a 2-for-1 stock split effective from July 1, 2025, the above indicators take this stock split into account.

    ‌Consolidated Financial Results by Segment for the Three Months Ended June 30, 2025

    Year-on-year differences in segment results

    • Building Business

      (Millions of yen)		Three months ended June 30, 2024	Three months ended June 30, 2025	Year on year	Year on year (%)	Main reasons for year-on-year differences in results
      Net sales		9,879	12,419	+2,539	+25.7	The increase in leasing revenue mainly reflected contributions due to the rise in earnings from the operations of the hotel and from ORSUS series acquired in the previous fiscal year, as well as due to success in raising leasing amounts. Note: The vacancy rate for the Group as a whole was 2.38% as of June 30, 2025.
      	Leasing revenue	6,828	7,069	+240	+3.5
      	Revenue from sales of properties	2,665	4,825	+2,160	+81.1
      	Other	386	525	+138	+36.0
      Operating profit		3,159	3,657	+498	+15.8
      	Gains on sales of properties	828	1,059	+230	+27.9	The increase in sales of properties reflected an increase in sales of inventories. (Osaka Office and Sapporo Office (part of the equity) were sold during the period under review.)

      • Leasing revenue

        • Operations of the hotel contributed about ¥0.2 billion to leasing revenue.

        • Revenues from acquired properties as well as due to success in raising leasing amounts, etc., contributed about ¥0.1 billion to leasing revenue.

        • Reduced periodic revenues resulting from sales of properties, etc. reduced leasing revenue by about ¥0.1 billion.

      • Revenue from sales of properties

    • Asset Management Business

    (Millions of yen)	Three months ended June 30, 2024	Three months ended June 30, 2025	Year on year	Year on year (%)	Main reason for year-on-year differences in results
    Net sales	699	703	+4	+0.6
    Asset management revenue	489	542	+53	+10.8
    Brokerage commissions	209	160	(48)	(23.3)
    Operating profit	315	318	+3	+1.1

    • The Asset Management Business saw an increase in revenue from higher asset management revenue.

    ‌Consolidated Balance Sheet as of June 30, 2025

  • Due to the payment of participation fee for the North 4, West 3, Type 1 District Redevelopment Project as well as the construction costs for Caption by Hyatt Kabutocho Tokyo, there was an increase in total assets. Total liabilities increased, reflecting a rise of trade accounts payable and interest-bearing liabilities.

    (Millions of yen)		As of March 31, 2025	Three months ended June 30, 2025	Year on year	Main reasons for year-on-year differences in results
    Total assets		419,541	426,832	+7,291
    	Current assets	60,036	55,701	(4,334)	The decreases in cash and deposits, as well as securities were mainly due to the payment of the participation fee for the North 4, West 3, Type 1 District Redevelopment Project and the payment of construction costs for Caption by Hyatt Kabutocho Tokyo. The decreases in inventories mainly resulted from the sale of Osaka Office and Sapporo Office (part of the equity).
    	Cash and deposits/Securities	25,341	20,389	(4,952)
    	Inventories (including operating investments in capital)	31,036	30,582	(453)
    	Other current assets	3,658	4,729	+1,071
    	Non-current assets	359,177	370,817	+11,639	The increase in the payment of participation fee for the North 4, West 3, Type 1 District Redevelopment Project and the payment of construction costs for Caption by Hyatt Kabutocho Tokyo. The increase was mainly due to the improvement in the market valuation of investment securities.
    	Property, plant and equipment	282,350	290,933	+8,583
    	Intangible assets	31,164	31,136	(27)
    	Investments and other assets	45,662	48,747	+3,084
    	Deferred assets	326	313	(12)
    Total liabilities and net assets		419,541	426,832	+7,291
    	Total liabilities	301,541	308,403	+6,861	The net debt-to-equity ratio was 2.0 as of June 30, 2025. Increase in other liabilities was mainly due to the result of increase in trade accounts payable.
    	Interest-bearing liabilities	254,072	256,718	+2,645
    	Other liabilities	47,469	51,684	+4,215
    	Net assets	117,999	118,429	+430	The increase was mainly due to the improvement in the market valuation of investment securities.
    	Shareholders' equity	86,749	85,361	(1,388)
    	Valuation difference on available-for-sale securities	15,265	17,074	+1,808
    	Deferred gains or losses on hedges	54	65	+10
    	Revaluation reserve for land	15,928	15,928	-

    • Cash and deposits/Securities

    • Inventories

    • Property, plant and equipment

    • Investments and other assets

    • Interest-bearing liabilities

    • Other liabilities

    • Valuation difference on available-for-sale securities

    (Note) Interest-bearing liabilities comprised short-term borrowings, current portion of bonds payable, current portion of long-term borrowings, certain other current liabilities, bonds payable, long-term borrowings, and long-term accounts payable-other.

    ‌Key Performance Indicators

    Share price*1,2

(Yen)

4000

3000

2,336

2,060

2,515 2,644 2,702 2,748

2,887 3,085

2,350

(Yen)

160.00

120.00

5.2% 5.8%

6.5%

6.3%

118.37

127.14

7.7%

141.55

118.06

7.9%

10.0%

8.0%

2000

1,511

1,291

1,728 1,834

1,410 1,419

1,728 1,978 1,893 2,040

80.00

3.4% 2.9%

4.7% 4.7%

79.37 92.41 94.88

7.3%

6.9%

6.0%

1000

1,077 1,157 1,189 1,222 1,315

1,400

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

40.00

2.6%

2.8%

55.25 56.59 66.29

2.8% 3.3% 3.2%

3.2%

3.3%

3.2% 3.2%

4.0%

2.0%

824 844

0

700 787

1,025 1,066

0.00

36.36 31.27

2.9%

3.1%

2.8%

0.0%

FYE FYE

Mar/14 Mar/15

FYE FYE

Mar/16 Mar/17

FYE FYE

Mar/18 Mar/19

FYE

Mar/20

FYE

Mar/21

FYE

Mar/22

FYE

Mar/23

FYE

Mar/24

FYE

Mar/25

FYE FYE FYE

Mar/14 Mar/15 Mar/16

FYE

Mar/17

FYE

Mar/18

FYE

Mar/19

FYE

Mar/20

FYE

Mar/21

FYE

Mar/22

FYE

Mar/23

FYE

Mar/24

FYE

Mar/25

Stock price Book value per share (BPS) Net asset value (NAV) per share

EPS ROE ROA

(Billions of yen)

420.1 421.2

439.8

316.3

339.5

244.2

26.4

363.5

119.4

376.8

112.4

388.9

112.2

111.5

116.7

128.4

268.7

41.7

286.4

62.0

289.6

70.3

85.6

103.3

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)

4.0

3.0

2.0

1.0

40.0%

29.0% 31.0% 32.3%

33.3% 34.9%

32.5% 31.6% 31.1% 31.7%

30.9%

30.0%

28.1%

1.7

1.6

1.5

1.7

1.9

1.4

1.4

1.6

1.5

1.6

1.5

1.6

30.0%

20.0%

10.0%

0

FYE

Mar/14

FYE

Mar/15

FYE

Mar/16

FYE

Mar/17

FYE

Mar/18

FYE

Mar/19

FYE

Mar/20

FYE

Mar/21

FYE

Mar/22

FYE

Mar/23

FYE

Mar/24

FYE

Mar/25

0.0

FYE

Mar/14

FYE

Mar/15

FYE

Mar/16

FYE

Mar/17

FYE

Mar/18

FYE

Mar/19

FYE

Mar/20

FYE

Mar/21

FYE

Mar/22

FYE

Mar/23

FYE

Mar/24

FYE

Mar/25

0.0%

Book value Unrealized gains

Net debt-to-equity ratio Equity ratio

*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 stock.

*2 Since the Company conducted a 2-for-1 stock split effective from July 1, 2025, the above indicators take this stock split into account.

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

* Since the Company conducted a 2-for-1 stock split effective from July 1, 2025, the above indicators take this stock split into account.

‌Forecast of Consolidated Financial Results by Segment for the Fiscal Year Ending

March 31, 2026

Year-on-year differences in segment results

• Building Business

• Asset Management Business

  (Millions of yen)	Fiscal year ended March 31, 2025	Fiscal year ending March 31, 2026 (Forecast)	Year on year	Year on year (%)	Main reason for year-on-year differences in results
  Net sales	4,078	4,400	+321	+7.9
  Asset management revenue	2,781	2,900	+118	+4.3
  Brokerage commissions	1,296	1,500	+203	+15.7
  Operating profit	2,355	2,500	+144	+6.1

  • Asset management revenue and brokerage commissions are expected to grow stable.

  ‌Disclaimer
  1. This document is not intended to solicit investment. Users of this document are requested to use their own judgment when making final decisions about investing.
  2. Information other than historical facts presented in this document are forward-looking statements that were formulated according to certain assumptions and were based on judgments by the Company's management in light of currently available information as of July 31, 2025. Therefore, these statements may differ significantly from results announced in the future due to a variety of factors. The Company assumes no responsibility for any losses resulting from the use of this document.
  3. The Company might revise the forward-looking statements contained in this document based on new information or future events; however, this document will not be updated.