ORIX JREIT INC.

OJR’s point of view

In 2021-22, OJR conducted scenario analyses based on TCFD recommendations to identify the impact of climate change on its business, identifying business risks and opportunities. The scenario analysis results suggest that the 1.5°C and 4°C scenarios could have a moderate impact by 2030, requiring measures to mitigate these impacts. OJR supports the Paris Agreement and has established its 2050 net zero and 2030 reduction targets, obtaining approval from SBTi for each. Regarding the 2030 target, the goal includes Scope 1 (S1), Scope 2 (S2) direct emissions, and Scope 3 (S3) tenant emissions, including those managed by OJR, in line with SBTi’s near-term requirements. It is proceeding systematically with measures to achieve the “OJR 2030 Target.” Achieving net zero is a long-term effort that will take over 20 years, and there are inherent challenges that OJR cannot overcome alone. Therefore, we have formulated a medium-to-long-term action plan as a “Transition Plan Toward Net Zero,” which will be addressed in phases. By 2030, we will focus on areas where OJR has management responsibility, promoting energy-saving renovations and introducing renewable energy. Post-2030, efforts will be made in collaboration with the entire value chain, including tenants.

Identification of Risks and Opportunities and Scenario Analysis

Scenario analysis based on TCFD recommendations analyzed the impact on earnings for 2030, with the 1.5°C scenario estimated to have an impact of 1–8% annually on earnings (operating income) and the 4°C scenario estimated to have an effect of around 3%.

Please click here for more details

Roadmap Toward 2030 Targets and 2050 Net Zero

OJR’s Goals

To achieve the goals of the Paris Agreement, we are working toward the long-term target of achieving Net Zero by 2050.

(1) By 2050, reduce total GHG emissions (Scope 1, 2, 3) across the entire value chain by more than 90% compared to 2021
→ SBTi SME version (for small and medium-sized enterprises) Net Zero target certification obtained

(2) As the “OJR 2030 Target,” reduce total GHG emissions from Scope 1, Scope 2, and Scope3 (Category 13 under OJR’s management authority) by 42% compared to 2021 by 2030.
→ Of this, the portion of GHG emission reductions for Scope 1 and Scope 2 has been certified as an SBTi SME version near-term target.

Roadmap

Target Year	2030 (Mid-Term Target)		2050 (Long-Term Target)
Scope	Scopes 1 and 2, as well as items managed by OJR under Scope 3 Category 13		Scopes 1, 2, and 3 (all)
Reduction Targets	42% reduction (considering a 3% annual increase in emissions due to expansion of asset size, etc.)	Level of Contribution to Reduction	90% reduction (considering a 3% annual increase in emissions due to expansion of asset size, etc.)
Countermeasures Anticipated Measures	Reduction through energy saving and energy creation (The average annual reduction is 1%)	22%	Reduction through energy saving and energy creation (The average annual reduction is 1%)^* Includes the effects of replacing properties, etc.
			Reduction through energy creation (about 5%)
	Reduction through renewable energy and non-fossil fuel certificates (50% renewable energy in areas managed by OJR)	51%	Reduction through renewable energy (100% renewable energy in areas managed by OJR by 2040)
	Reduction through lower power emission factor (about 3% annually)	27%	Reduction through decarbonization of non-electric energy sources (gradual progress from 2035 onward, 90% reduction anticipated by 2050)
	About 10% reduction in tenant areas anticipated through adopting renewable energy (area not covered in the targets)		Reduction through tenant response (90% renewable energy by 2050 anticipated through continuous response)
			Reduction through decarbonization of services, capital goods, and waste disposal (gradual progress from 2030 onward, 80% reduction anticipated by 2050)

Energy creation: Initiatives to generate energy on one’s own, such as through solar power generation.

Progress of Metrics and Targets

The GHG total emissions (Scope 1, Scope 2, and Scope 3) that form the basis for the “2050 Net Zero Target” decreased by 4.5% in 2024 compared to the baseline year of 2021.
Regarding the “OJR 2030 Target” (Scope 1, Scope 2, and Scope 3 Category 13 under OJR’s management), a reduction of 24.0% was achieved in 2025 compared to the baseline year of 2021. The portion of the “OJR 2030 Target,” excluding emissions from fluorocarbons, is also the SPT (target) for the Sustainability-Linked Loan, and incorporating the GHG reduction element into financing serves as an incentive to achieve the “OJR 2030 Target.”
Although investing in obtaining Green Building certifications and energy-efficient renovations may be costly in the short term, we believe it will contribute to future earnings in the medium to long term, so we will continue investing.

	Details	Unit	FY2021	FY2022	FY2023	FY2024	FY2025	FY2030
OJR 2030 Target	Scorpe1,2 and 3 (Managed by OJR)	t-CO₂e	50,961	48,556	46,283	43,826	41,431	29,557
Actual records regarding environmental targets	GHG total emissions	t-CO₂e	105,472	107,497	100,988	101,876	100,757	-
	OJR 2030 Target Scorpe1,2 and 3 (Managed by OJR)	t-CO₂e	50,961	50,148	44,463	38,011	38,728	-
	Reduction rate compared to 2021	%	ー	1.6%	12.8%	25.4%	24.0%	42%
	Introduction rate of renewable energy	%	2.2%	8.8%	11.7%	21.8%	24.2%	-
	Green building certification floor area coverage ratio	%	83%	84%	82%	82%	79%	Over 80%
Financial performance	AUM(total acquisition price)	Million yen	688,969	688,361	696,178	724,564	797,195	2021(39th and 40th financial period) 2022(41st and 42nd financial period) 2023(43rd and 44th financial period) 2024(45th and 46th financial period) 2025(47th and 48th financial period)
	Operating revenues	Million yen	47,376	51,791	54,502	51,852	59,604
	Operating revenues from green building certified properties	Million yen	29,957	36,975	38,797	39,975	40,697
		Ratio	63%	71%	71%	77%	68%
	DPU(yen),br>	Per a year	3,507	3,960	3,823	3,906	4,684
	GHG emissions intensity (base on AUM)	t-CO₂e/ Million yen	0.2	0.2	0.1	0.1	0.1
	GHG emissions intensity (base on revenue)	t-CO₂e/ Million yen	2.2	2.1	1.9	2.0	1.7

Engagement

Value Chain Engagement

Achieving the 2050 Net Zero Target requires the entire value chain to move toward Net Zero. OJR also promotes engagement to encourage PM, BM, tenants, and other stakeholders to advance their initiatives.

For PM and BM companies, we regularly hold briefings and study sessions to ensure understanding of OJR’s stance on climate change and set targets, facilitate the reporting of environmental data, and coordinate responses during renovations.
For tenants, some have been requested to consider introducing renewable energy into tenant-managed areas, and discussions have been initiated. Most tenants have signed Green Leases, creating a situation where sustainable initiatives can be pursued collaboratively. Moving forward, we aim to promote collaboration further while ensuring an understanding of OJR’s initiatives and inquiring about the tenants’ needs for sustainable efforts.
Understanding and support from unitholders and financial institutions are also critical. This report discloses information about our climate change and sustainability initiatives, IR-related materials, website, etc. Additionally, we seek more profound engagement with financial institutions through sustainability finance.

Policy Engagement

Government policies play a critical role in ensuring a Net Zero society’s prompt and reliable realization. OJR’s transition roadmap includes expectations for policy-driven initiatives, such as promoting the adoption of renewable energy, decarbonizing energy use, and reducing carbon emissions in the construction and waste disposal industries. OAM engages in policy advocacy through its participation in initiatives and recommendations to the government. It also organizes individual dialogues with relevant ministries to advance efforts toward achieving a Net Zero society.

Third-Party Verification

A third-party organization (Japan Quality Assurance Organization) has verified the GHG emissions, energy usage, water usage, and waste weight disclosed by OJR since the 2021 fiscal year.

Please click here to see previous Environmental Information Independent Verification Reports

Environment Transition Plan Toward Net Zero