Firstly, our prayers are with all those affected by the 2024 Noto Peninsula Earthquake that struck on January 1, 2024. We offer our condolences in particular for those who lost their lives. We would also like to pay tribute to the many hardworking people providing relief to victims and helping to restore affected areas.

In reaching the end of our 17th fiscal period ended February 2024, we would also like to extend our sincere gratitude to all unitholders for your continued support of Nomura Real Estate Master Fund, Inc. (NMF).

During the 17th fiscal period, we continued implementing asset replacement as part of our policy of external growth, as a result of which we acquired four properties and disposed of three properties. Through continuous asset replacement, we aim to enhance the quality of our property portfolio by improving the ratio of properties in the Greater Tokyo area and improving building age, and achieve steady increases in distributions by realizing gains on sales.

In the fiscal period under review, we maintained stable performance in the office sector by leveraging the sales strength of the Nomura Real Estate Group and through appropriate and flexible leasing activities based on market trends. In the rental apartment sector, continuing tailwinds in the market enabled us to maintain high occupancy rates and achieve rent increases. In the retail sector as well, there are signs of improved earnings due to positive sales in a number of our large properties. And in the logistics sector, we achieved rent increases when renewing major contracts against the background of a strong market. Thus, we were able to leverage the strengths of NMF during this fiscal period as well to continue ensuring stable earnings through flexible operations that took market changes into account.

As a result, at the end of the 17th fiscal period, our portfolio consisted of 291 properties with a total acquisition price of ¥1,103.5 billion. Operating revenues totaled ¥39,375 million, operating profit reached ¥15,172 million, and net income came to ¥12,958 million for the fiscal period.

In the area of ESG (Environment, Social and Governance) activities, which we have been promoting for some time, we recognize that achieving a sustainable society is critical to the sustainable growth of NMF. In October 2022, therefore, we declared our commitment to achieving net zero greenhouse gas (GHG) emissions by fiscal 2050. This fiscal period, we have also identified new materiality issues relevant to the social field with the aim of addressing social issues through our real estate operations.

While carefully monitoring trends in market changes, we will continue to manage properties with a strong determination to improve fund performance in order to meet investors’ expectations and earn their trust. We ask for your continued support and encouragement.

Executive Director of Nomura Real Estate Master Fund, Inc.