To Our Valued Investors,

Thank you for your continued support.

Since its stock was first listed in 2005, HEIWA REAL ESTATE REIT (“REIT”) has been investing in and operating medium-sized offices and single and compact residential properties primarily in the 23 wards of Tokyo.

Since the change of sponsor in 2009, the REIT has been working on maximizing the interests of investors and steadily grown its business with Heiwa Real Estate Group as its sponsor. Since 2020, the spread of the COVID-19 pandemic has been adding to the uncertainty in the real estate market. Amid these conditions, the REIT announced in July 2021, the NEXT VISION (asset size of 300 billion yen, distribution of 3,300 yen, AA- rating, and 100% electricity introduction rate derived from renewable energy), its new medium- to long-term targets. It has registered solid growth even in the COVID-19 pandemic and achieved its targets early excluding the asset size. In January 2024, the REIT announced NEXT VISION II (asset size of 300 billion yen, distribution of 3,800 yen, annual rental income of +1%, 10% ROI, AA rating, 90% GHG reduction by 2030, 100% electricity introduction rate derived from renewable energy) as new medium-term targets and has promoted to build a portfolio that can withstand cost increases attributable to inflation and the impact on interest costs due to policy changes by the Bank of Japan. In January 2025, the REIT announced NEXT VISION II+ , its new medium-term targets.
As part of an expanded effort to enhance capital efficiency and maximize unitholder value, the REIT aims to implement three key enhancement initiatives:Increasing investor returns,Facilitating internal growth,strengthening asset turnover-type strategy.
Under this plan, the REIT set a DPU target of 4,200 yen and projected an annual rental income growth rate of +2% through internal growth. Furthermore, in July 2025, the internal growth rental income target was raised to +5% per year.
Responses to issues surrounding the environment, society, and corporate governance are important and significantly affect all of the management and business of the REIT. It recognizes that efforts to build a sustainable society contribute to the sustainable growth of the REIT. The REIT establishes ESG targets and strives to achieve them as one of its growth strategies.

The REIT aims to contribute to the interests of its investors and all other stakeholders while leveraging the sponsorship of the Heiwa Real Estate Group for both external and internal growth.
We earnestly ask for your continued support of our business.