All of us at Mori Hills REIT Investment Corporation ("MHR") wish to extend our deep appreciation to our unitholders for your continuous support of MHR. I am pleased to report on MHR’s performance for the thirty-eighth fiscal period which ended July 31, 2025.

In the thirty-eighth fiscal period, the Japanese economy continued to improve moderately due to strong capital investment and increased exports, despite the ongoing impact of price hikes and some weakness seen in consumer spending.

In such an economic environment, the rental office market experienced a consistent decline in vacancy rates and continued strong rent levels, due to ongoing relocation demands for purposes that include businesses expanding operations, improving locations, and upgrading office-grades.  As for the luxury rental housing market, occupancy rates and rent levels remained solid, driven by ongoing stable demand for quality housing in central Tokyo. In terms of the real estate trading market, the transaction amount and transaction prices remained at a high level thanks to the active portfolio asset replacement activity of J-REITs, as well as being driven by large transactions with foreign companies.

In the thirty-eighth fiscal period, MHR strove to maintain and enhance tenant satisfaction through measures such as efficient and systematic operational management and maintenance and repair of properties in its portfolio by better understanding tenant needs. Moreover, MHR maintained and enhanced occupancy rates and rents by proactively launching leasing activities targeting new and existing tenants while foreseeing trends in rental market conditions.

MHR’s real estate portfolio, as of the end of the thirty-eighth fiscal period, was comprised of 11 properties under management with a total leasable area of 182,655.52m2. MHR has already invested 407,908 million yen (based on the acquisition price) into this portfolio. The occupancy rate at the end of the thirty-eighth fiscal period was 99.5%.

The asset management activities described above resulted in MHR recording in the thirty-eighth fiscal period 11,223 million yen in operating revenue, 6,795 million yen in operating income, 6,094 million yen in ordinary income and 6,093 million yen in net income and 3,090 yen in dividend per unit. MHR disposed of a part of Laforet Harajuku (Land) (disposition price: 3,073 million yen) on July 1, 2025. Of the 1,522 million yen from gain on this disposition, 265 million yen was classified as reserve for reduction entry.

In addition, MHR plans to acquire additional Toranomon Hills Mori Tower (acquisition price: 9,669 million yen) and to transfer a part of Laforet Harajuku (Land) (disposition price: 3,073 million yen) on December 1, 2025, dividend per unit of 3,100 yen is forecasted for the thirty-nineth fiscal period ending January 31, 2026.

MHR will continue to seek maximization of unitholder value by maintaining and increasing dividends continuously while retaining stability of earnings through fixed-rent master leases alongside actively pursuing external growth utilizing the property pipeline of the Mori Building Group.

I would like to ask for your continued support.