Nomura Private REIT (Location: Shinjuku-ku, Tokyo; Representative Executive Officer: Tomohito Suga; hereinafter "NPR"), announces the launch of a new initiative to support the reduction of CO2 emissions.

In this initiative, NPR's condominium "PRIME URBAN Meguro Riverfront" (Location: Meguro-ku, Tokyo; Total number of units: 46) will be supplied with electricity from 100% ("Renewable Energy"), a substantially renewable energy source, to the entire building by applying a bulk power distribution service to the entire building. This will contribute to the reduction of NPR's Scope 2 and Scope 3 (indirect greenhouse gas emissions in the supply chain) emissions, thereby enhancing the value of NPR. The power supply to the condominium is expected to start in the fall of 2025, and NPR plans to study the possibility of introducing the system to other condominiums owned by NPR in the future.

◾️ Renewable energy supply using bulk condominium power receiving service
Our core business, "condominium bulk power receiving service," procures high-voltage power equivalent to the usage of a single condominium building, converts it to low-voltage power at the power receiving and transforming facilities installed in the condominium, and supplies it to the common areas and each household. We have been providing economic benefits to condominium residents based on our strength in procurement and operational excellence, supported by our customer base from many years of business operations and the volume of demand from other businesses for corporate customers. In addition, in recent years, we have been strengthening the development of new services to realize "whole building decarbonization" by combining renewable energy supply, solar power generation equipment, and storage batteries, taking advantage of the scheme of concluding power supply contracts for each condominium building.

This initiative is to convert the entire building's electricity consumption to renewable energy using the mechanism of the bulk power receiving service for condominiums. Furthermore, the procurement cost of non-fossil certificates for this service will be realized without being passed on to electricity rates. Generally, rental condominiums managed by real estate investment corporations are smaller in terms of the number of occupied units and the amount of electricity used per unit than properties where lump-sum condominium power receiving services have been introduced in the past, and it has been considered difficult for lump-sum power receiving service providers to secure profitability. However, the knowledge and know-how we have accumulated over the years have made this initiative possible.

◾️Background of the decision on this initiative
NPR is Japan's first privately placed REIT, having commenced operations in November 2010. Aiming to secure long-term stable income and steady growth of assets under management, NPR has built up a track record by investing in various types of real estate properties, including condominiums, office buildings, and hotels. We have been pursuing various initiatives to lead the industry not only in terms of profitability but also in terms of sustainability, and our goals by FY2030 include "a 100% renewable electricity ratio for the portion equivalent to Scope2 emissions" and "a reduction of 801 TP3T of CO2 emissions in our portfolio compared to FY2021.

Based on this policy, NPR is implementing advanced measures such as utilizing renewable energy procured through off-site PPAs at its office properties. On the other hand, among NPR's properties, condominiums account for a high percentage of Scope 3 emissions from their tenants' electricity consumption, and reducing these emissions was considered difficult because it would require encouraging all tenants to switch to renewable energy, including reviewing their contracts with electricity providers.

In addition, for reporting to the GRESB*, an international evaluation of ESG-related initiatives of companies and funds in the real estate domain, it is necessary to grasp the electricity consumption of an entire building. In the past, the practical burden of reading the meters for each household onsite every year in order to respond to this issue has been a challenge.

In this initiative, the condominium collective power receiving service scheme will enable all households to convert their electricity consumption to renewable energy all at once, and since we will also be responsible for meter reading, we will be able to easily monitor electricity consumption for reporting to the GRESB. We have decided to launch this initiative because we can solve the aforementioned issues through this scheme and contribute to the further enhancement of the value of NPR.

*GRESB: An annual benchmark assessment of companies and funds in the real estate sector to measure their environmental, social and governance (ESG) progress. It is also the name of its governing body. (Reference:https://www.gresb.com/ )

◾️Future collaboration between the two companies
NPR has been strengthening its sustainability initiatives year after year in order to enhance its value over the medium to long term, and we intend to support such initiatives and contribute to the sustainability of society as a whole by strengthening cooperation. Discussions are already underway to expand the introduction of "whole-building renewable energy supply" to other properties owned by NPR, similar to this initiative. At the same time, we are also discussing an initiative to realize in-house consumption of solar power generation within condominiums by installing solar power generation equipment at the same time as the condominium bulk power receiving service, depending on the conditions of the property, and concluding an on-site PPA contract between the Company and NPR.
By leveraging the flexible solutions that only a company with multiple businesses in the energy domain can provide, and by collaborating with NPR, we aim to make a greater contribution to the promotion of sustainability in the real estate domain.

◾️ Comment from Asset Management Section, NPR Management Department, Nomura Real Estate Investment Management Co.
NPR is working on sustainability measures to increase unitholder value over the medium to long term, and this is the first time that NPR has been able to monitor the power consumption of an entire residential building, including private areas, and switch to renewable energy. The switchover requires the consent of all tenants, which was achieved thanks to the extensive experience and know-how of Rezil.
NPR will continue its efforts to monitor the amount of electricity consumed in the exclusive residential areas of the properties it owns and to switch to renewable energy sources.

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