MITSUBISHI ESTATE Annual Report 2014

markets of emerging countries and the prolonged sovereign debt crisis in Europe. Although the Mitsubishi Estate Group did not reach its targets numerically, on a qualitative basis, I think the results were satisfactory in terms of what we expected to achieve during the preparation stage under our long-term management strategies. For example, the Marunouchi Eiraku Building completed in January 2012 is situated at the intersection of the Marunouchi and Otemachi districts, effectively expanding our redevelopment area. Moreover, opened in October 2012, Otemachi Financial City, which is intended to strengthen the district’s function as a financial center, is also contributing to the enhancement of Tokyo’s functionality. In the Residential Business, established in fiscal 2011, we have taken steps to reinforce our value chains and upgrade business efficiency, principally though Mitsubishi Jisho Residence Co., Ltd. In addition, we have strengthened our condominium management business and progressed with the development of new business fields, such as the renovation business.We have also been active overseas, expanding our property portfolios in the United States and Europe as planned. Especially in London, I think we have put in place ideal business operations demonstrating balanced capital flows—the business is steadily recovering previous investments while continuing to invest in new properties. Moreover, we are building our property portfo-lios in Asia. In Singapore, Mitsubishi Estate is proceeding with its first office development project in Asia and making progress with housing developments in China. Long-Term Management Vision BREAKTHROUGH 2020 and Medium-Term Management StrategiesBased on the background I have just described, in 2011, we formulated our long-term management vision, BREAKTHROUGH 2020, establishing long-term management strategies to take Mitsubishi Estate up to 2020. While reflecting on the details of the plan, let me report on the results of the first medium-term management strategies of our management vision that ended in fiscal 2014.Under BREAKTHROUGH 2020, we have set a series of goals for the Mitsubishi Estate Group. Among them are reinforc-ing our value chains and achieving Group growth by cementing our No. 1 position in the investment and development business fields in Japan. Other goals include proceeding with the redevel-opment of the Daimaruyu area, consisting of the Otemachi, Marunouchi, and Yurakucho districts, building the REIT invest-ment market, firmly establishing our new condominium brand, and expanding the International Business.The details of the medium-term management strategies covering the period from fiscal 2012 to fiscal 2014—positioned as the preparation stage for the future growth of the Group—are shown on the page on the right. As shown at the top, we roughly attained our targets for performance and stability—EBITDA over total assets and net interest-bearing debt over EBITDA. Unfortunately, we were unable to achieve our growth potential target, EBITDA, primarily because of unexpected turns in several assumptions: the impact of the Great East Japan Earthquake lasted longer than expected; and, similarly, the recovery of the office building market was overly delayed against the backdrop of such abnor-mal conditions in the global economy as the stagnation in the To Our StakeholdersOtemachi Financial CityMarunouchi Eiraku BuildingTop: 1 Victoria StreetBottom: MARK IS minatomirai14MITSUBISHI ESTATE CO., LTD.