President & CEO
Japan Real Estate Asset Management Co., Ltd.

Aiming to Maximize Unitholder Value by Further Enhancing Our Sustainability Initiatives

JRE’s Sustainability Initiatives

Japan Real Estate Investment Corporation (JRE), which in September 2001 became the first J-REIT to be listed on the Tokyo Stock Exchange, invests in large-scale office buildings in Japan. Japan Real Estate Asset Management Co., Ltd. (JRE-AM), the asset management company of JRE, has long positioned sustainability as one of its management priorities, establishing an ESG Office (currently the Sustainability Management Department) in 2018.
Since then, JRE-AM has conducted a variety of sustainability initiatives. Specifically, in 2022, we identified important issues as materiality and established key performance indicators (KPIs) for fiscal 2030. We have also conducted pioneering initiatives in the J-REIT industry, including disclosing information in line with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), engaging in financing through sustainability-linked loans (SLLs), joining RE100, and converting existing buildings to zero energy buildings (ZEBs). JRE’s proactive stance on sustainability has gained extensive support from stakeholders.

Recent major initiatives and achievements are as follows.

• Acquisition of environmental certifications and enhanced assessments (certification acquisition rate stood at 92.2% as of the end of fiscal 2024, achieving our KPI for ensuring that more than 90% of our properties have environmental certificates by fiscal 2030)
• Acquisition of ZEB certification (received our fifth ZEB certification^*1 in fiscal 2024, achieving our KPI for owning 5 to 10 ZEBs by fiscal 2030)
• Disclosure of detailed analysis and results of the financial impact of physical risks
• Disclosure of the social impact of real estate^*2
• Revision of the personnel system (enhanced evaluation feedback, increasing it from annually to biannually, and extended the retirement age from age 60 to 65)
• Maintenance and improvement of external evaluations (including receiving 4 stars from GRESB, an “A” score from the CDP, the Incentive Prize in the 2024 Award of the Heat Pump & Thermal Storage Technology Center of Japan, the Good Action Award (Environment Category) in the ARES ESG Award, and achieving certification and registration for Eco-Action 21)

As global warming progresses and extreme weather events increase across the world, we will advance our sustainability initiatives with a sense of mission. Currently, one of our focus areas is the switch to electricity made from renewable energy (“renewable electricity”).
At JRE-owned office buildings, we can reduce CO2 emissions to zero, including the CO2 emissions of tenants, by adopting renewable electricity for use in both common areas and tenant sections. JRE is proactively adopting renewable electricity, achieving an adoption rate of 82.2%^*3 as of the end of fiscal 2024. We will steadily advance initiatives for a sustainable future with the aim of achieving an adoption rate of 100% for renewable electricity by fiscal 2050. To achieve this long-term target, we have set forth the medium-term targets of achieving 85% by fiscal 2025 and 90% by fiscal 2030, thereby advancing the phased adoption of renewable electricity.
As part of these initiatives, in 2022 we became the first J-REIT to join RE100, an international framework. Signifying our strong commitment to transition to renewable energy, this marked a major milestone.
Our consideration for the environment extends beyond electricity. At JRE-AM, not only employees in charge of the Sustainability Management Department and other relevant parties, but also senior management are actively involved in sustainability matters, monitoring the energy consumption, water consumption, and waste volumes and recycling rates of our buildings on a monthly basis. In these ways, everyone is working with an awareness of the issues and to improve each metric in their daily operations.

Aiming to Maximize Unitholder Value by Pursuing the Provision of High-Quality Office Buildings

I became the President & CEO of JRE-AM in April 2025. While JRE-AM has strongly promoted sustainability-oriented management for a long time, it will further enhance such initiatives going forward to maintain and improve its position as the leading J-REIT for sustainability.
JRE aims to create long-term investment opportunities and maximize unitholder value through the provision of high-quality office buildings. We believe that a sustainability perspective is essential to achieving this goal.
In recent years, tenants’ requirements of offices have become increasingly diverse. In addition to rent and location, a greater emphasis is now being placed on elements including environmentally friendly equipment, high levels of energy efficiency performance, and comfortable workplace environments that enable employees to work with enthusiasm.
Accurately identifying these needs and putting in place such equipment and office environments helps tenant companies in their efforts to retain and recruit human resources, ensure business continuity, and enhance corporate value.

Meanwhile, Japan faces risks from natural disasters, including earthquakes, tsunamis, and typhoons. For example, in response to inundation risks, the adoption of both “hard” measures—such as the use of water-stopping plates and the installation of waterproofed doors for underground rooms with important equipment—and “soft” measures—including the implementation of disaster preparedness drills and the introduction of systems that enable the instant understanding of disaster conditions—enhances the safety of buildings. Although such efforts require a certain level of investment, they ensure that we remain the first choice of tenants in the office market and lead to the realization of returns to unitholders over the medium to long term by facilitating the recognition of JRE buildings by many companies as safe and secure office buildings. We engage in a process of trial and error to create and further extend such a virtuous cycle.

Anticipating Trends and Working Together with Stakeholders

In 2025, the world of sustainability began to encounter headwinds, resulting in a turbulent start to the year. In the United States, a change of government undermined the existing stance toward ESG issues, and the trend for sustainable investment appears to be in partial retreat. On the other hand, in the United Kingdom and Europe, where sustainable investment has become established, trends in support of sustainability initiatives persist.
As strong concerns about greenwashing continue to feature and the credibility of sustainable investment is called into question, we are seeing a strengthening of legal restrictions and third-party verification. Europe has begun adopting sustainability information disclosure standards that align with the International Sustainability Standards Board (ISSB) and applying European Sustainability Reporting Standards (ESRS) in accordance with the Corporate Sustainability Reporting Directive (CSRD). In Japan, the Sustainability Standards Board of Japan (SSBJ) is also aligning its standards with those of the ISSB.
In light of these circumstances, we will go beyond superficial sustainability initiatives to pursue effective actions. Especially now, when concerns about greenwashing are intensifying, we have a responsibility to ensure sincere and transparent information disclosure and continue to be a trusted presence. We will therefore strengthen mutual communication with our stakeholders and improve the value of office buildings through collaboration to maximize unitholder value. We look forward to receiving your continued support.

• In March 2025, JRE Amagasaki Front Building received ZEB Ready certification as a large-scale office building (gross floor area of 10,000 m2 or more), a first for a J-REIT.
• Defined as real estate that is expected to create social impact by contributing to the resolution of social issues affecting people (users), communities (surrounding land and local communities), and the planet (the global environment), and help create value for society, including the conservation of the global environment, while increasing the value of real estate and promoting sustainable growth.
  Source: Practical Guidance on Social Impact Real Estate (Ministry of Land, Infrastructure, Transport and Tourism, March 2023.
• Percentage of electricity from RE100-compliant renewable energy in Scope 2