Staying Ahead of the Times to Provide New Value Integrated Report 2020 Contents P 2 Track Record of Mitsubishi Estate P 50 ESG Section and Its Business Expansion 52 Materiality 54 Environment (E) Mitsubishi Estate’s Strengths P 5 55 TCFD 6 Marunouchi Today 56 Human Resources and Diversity (S) “A Love for People 57 Resilience (S) Mitsubishi Estate’s Value Creation Model P 8 58 SASB 59 Corporate Governance (G) P 10 Message from the President A Love for the City ” 59 Message from the Chairman of the Board 60 Directors Overview of Long-Term Management Plan 2030 P 14 61 Corporate Executive Officers, Executive Officers, Forever Taking On New Challenges—The Mitsubishi Estate Group 16 The Group’s Strengths and Growth Strategies and Group Executive Officers 18 Road Map for 2030 62 Characteristics of Corporate Governance System 64 Evaluation of the Effectiveness of the Board of 20 SPECIAL FEATURE 1 Domestic Asset Business Directors / Remuneration CO • MO • RE YOTSUYA The Spirit of Mitsubishi: Three Principles 65 Shares Held for Strategic Purposes 22 SPECIAL FEATURE International Asset Business 2 66 Message from an Outside Director “Shoki Hoko” “Shoji Komei” “Ritsugyo Boeki” Condominium Business in Bangkok, Thailand 68 Risk Management 24 SPECIAL FEATURE 3 Non-Asset Business Corporate Responsibility to Society Integrity and Fairness Global Understanding through Business Participation in the Elevator Media Business Strive to enrich society, both materially Maintain principles of transparency Expand business, P 71 Financial Section and spiritually, while contributing and openness, based on an all-encompassing 26 Message from the Corporate Officer in Charge of toward the preservation of conducting business with global perspective. 71 Japan’s Real Estate Market the global environment. integrity and fairness. Finance & Accounting and Corporate Communications 72 Eleven-Year Summary of Selected Financial Data (Consolidated) P 30 Business Review 74 Financial Review Structural Reforms to Drive Growth Strategies The Mission of the Mitsubishi Estate Group 31 76 Consolidated Balance Sheets 32 Business Segments We contribute to society through urban development. 78 Consolidated Statements of Income / 34 Commercial Property Business Consolidated Statements of Comprehensive Income By building attractive, environmentally sound communities where people can live, work, and relax with contentment, we contribute to the creation of a truly meaningful society. 34 Office Building Business 79 Consolidated Statements of Changes in Net Assets 36 Retail Facility Business / Outlet Mall Business 81 Consolidated Statements of Cash Flows The Mitsubishi Estate Group Code of Corporate Conduct 37 Logistics Facility Business 82 Notes to Consolidated Financial Statements 38 Hotel Business 105 Independent Auditor’s Report In order to carry out the Group’s Mission, 39 Airport Operation Business we pledge to observe the following Code of Conduct: 40 Residential Business P 114 Corporate Data 1 2 3 42 International Business 114 Principal Mitsubishi Estate Group Companies We will strive to earn We will strive to create 44 Investment Management Business 116 Corporate History We will act with integrity. the trust of our clients. a vibrant workplace. 45 Architectural Design & Engineering Business and 117 Organization Real Estate Services Business We will base our conduct on laws We will approach all objectives from While aiming at personal growth, we 118 Corporate Information and ethics and always reflect with our clients’ point of view, providing will respect the human rights and 46 Innovation and Business Transformation Group humility upon our behavior, valuing safe and reliable products and diversity of opinions of others and 119 About Our Website our communication with society and services, and make information increase our creativity and professionalism, 49 Business Development, Client Relations & placing priority in our corporate available as appropriate. while displaying our activities on earning trust through collective strengths as a team. Solutions Group fairness and transparency. A Word about Integrated Report 2020 We adopted this integrated report format starting from FY2019, having published annual reports through to FY2018. With this integrated report, we have expanded coverage of For details on the Mitsubishi Estate Group Guidelines for Conduct: non-financial information centering on environmental, social, and governance (ESG) compared with prior annual reports. In doing so, we aim to increase readers’ awareness of our efforts to raise the corporate value of the Mitsubishi Estate Group from a medium-to-long-term perspective. We hope that this report promotes a deeper understanding of https://www.mec.co.jp/e/company/charter/index.html the Group among all our stakeholders, including shareholders and investors. Definition of Term “FY2020” refers to the Group’s fiscal year ended March 31, 2020, and other fiscal years are referred to in a corresponding manner. (Formulated December 1, 1997; revised on August 1, 2002, January 1, 2006, and April 1, 2018) Caution Concerning Forward-Looking Statements This integrated report contains forward-looking statements concerning Mitsubishi Estate Co., Ltd., and its future strategies and earnings outlook, including forecasts, plans, and decisions based on information available at the time of publication. As with any forecast, plan, or decision, forward-looking statements are inherently susceptible to potential risks, uncertainties, and assumptions. The Company’s actual results may therefore vary materially from those expressed or implied in its forward-looking statements. MITSUBISHI ESTATE CO., LTD. Integrated Report 2020 1 Track Record of Mitsubishi Estate and Its Business Expansion The Mitsubishi Estate Group has overseen the development of the Marunouchi area over the last 120 years, evolving it into Japan’s preeminent business center. In the process, we have accumulated unique knowledge and expertise in urban development. Looking ahead, we are expanding our business to a variety of domains by leveraging this knowledge and expertise. Outlet Malls 2000 Opened GOTEMBA PREMIUM OUTLETS® Start-Up Support 2009 Converted Chelsea Japan Co., Ltd., into consolidated subsidiary (renamed 2007 Established EGG JAPAN, a new Akasaka Park House Mitsubishi Estate·Simon Co., Ltd., GOTEMBA PREMIUM OUTLETS® business creation support hub, in the Residences Hotels in February 2013) Shin-Marunouchi Building 1969 Akasaka Park House sold in lots, 1989 Opened the Royal Park Hotel 2016 Established FINOLAB, a co-working Started condominium business office specializing in fintech start-ups 2011 Mitsubishi Estate Residence Co., Ltd., Royal Park Hotel founded through the integration of the residential businesses of Mitsubishi Estate Co., Ltd., Mitsubishi Real Estate Services Co., Ltd., and Towa Real Estate Co., Ltd. International Business Acquisition of hotel sites and operation of Development of outlet malls boasting the top customer- Establishment of a hotels by leveraging tenant relationships and drawing power in Japan by leveraging tenant relationships new Marunouchi brand 1972 Established Mitsubishi operation and management expertise we have and information networks established through the as a hub for technology start-ups Estate New York Inc. built up in Marunouchi operation of Marunouchi retail facilities 1986 Established MEC UK Limited 1990 Initiated capital investment in the Rockefeller Group International, Inc. A History of Business Expansion with Marunouchi as a Base 2008 Established Mitsubishi Estate Provision of residential properties and Asia Pte. Ltd. services combining the comfort, safety, Investment Management and other qualities cultivated through our operation and management of Business office buildings 2001 Japan Real Estate Investment Corporation Establishment of a robust network became the first JREIT in Japan to be listed on through the expertise refined and Leveraging the expertise and Accumulation of expertise the Tokyo Stock Exchange accumulated in the development of knowledge gained through a track record 2015 Acquired the American investment management Marunouchi as well as ample in Marunouchi of operating abundant company TA Realty LLC financial resources real estate assets 2017 Mitsubishi Estate Logistics REIT Investment Returning the expertise and Corporation was listed on the Tokyo Stock Exchange Utilization of plot ratio transfer knowledge gained through and other methods in the redevelopment of Marunouchi other business to Marunouchi Marunouchi Redevelopment 1890 1890s–1950s 1960s–1980s 1995–2019 2020– Starting from Scratch First Phase of Development Second Phase of Development Third Phase of Development Marunouchi NEXT Stage Purchase of Marunouchi land and Dawning of a full-scale business An abundance of large-capacity office build- Creating the world’s most interaction-inspiring neighborhood Transforming Marunouchi into an area that continuously creates vision of a major business center center development ings in a period of rapid economic growth Following the announcement of the reconstruction of the former Marunouchi new value The history of Mitsubishi Estate began when The construction of the area’s first modern office As Japan entered an era of high economic growth, Building in 1995, the Company transformed the Marunouchi area—which had Positioning urban development from 2020 onward as part of the “Marunouchi Yanosuke Iwasaki, the first president of building, Mitsubishi Ichigokan, was completed in there was a sharp