In its Environmental Charter, KJRM recognizes the Earth as its most important stakeholder and states: "We recognize the critical importance of what ecosystems can provide and are committed to protecting ecosystems and mitigating any potential impacts on biodiversity."
Taking into account the relationship between the natural environment and business activities, KJRM strives to conserve biodiversity through green space management, environmental conservation, and consideration for the local environment at its portfolio properties.
IIF discloses nature-related information with reference to the TNFD framework. In addition to the general requirements that apply across all recommended disclosures, disclosures are organized in accordance with the structure of the recommended disclosures, which consist of 'Governance,' 'Strategy,' 'Risk and Impact Management,' and 'Metrics and Targets.'
General Requirements: Matters that are expected to be considered to ensure consistency in disclosed information
Governance: Governance of nature-related dependencies, impacts, risks and opportunities
Strategy: Impacts of nature-related dependencies, impacts, risks and opportunities on the business
Risk and Impact Management: Processes for identifying, assessing, prioritizing, and monitoring nature-related dependencies, impacts, risks and opportunities
Metrics and Targets: Metrics and targets used to assess and manage nature-related dependencies, impacts, risks and opportunities
Based on the Mission Statement and Sustainability Basic Policy, IIF has identified material sustainability issues (materiality) to be addressed through its business activities. Environmental materiality topics include 'Climate Change Response,' 'Biodiversity,' 'Resilience,' 'Water Resources,' and 'Waste,' which are recognized as important issues for realizing a sustainable society. In identifying materiality, IIF prioritizes issues based on their impact on business operations, while taking into account stakeholder and social significance.
For details, please refer to “Materiality”.
In analyzing nature-related issues, IIF focuses primarily on the real estate management sector, covering properties it has invested in and operates. While IIF recognizes the importance of analysis covering the entire value chain, given constraints in data acquisition and the complexity of analysis, it is currently proceeding step by step, starting with a scope that is analytically feasible, centered on assets owned and managed by IIF.
Taking into account IIF's asset portfolio and asset concentration areas, IIF has provided an overview of the interfaces with nature and potential risks and opportunities for the Narashino, Fujisawa, Sagami River, and Osaka areas. In the scenario analysis, a qualitative assessment was conducted for all portfolio properties regarding the impact of nature-related issues on business activities. Based on this, detailed analysis of nature-related issues has been conducted with priority focus on IIF Shonan Health Innovation Park, which has been identified as a priority location.
IIF believes it is important to address climate change, biodiversity, and other environmental issues in an integrated manner, being mindful of their relationships and trade-offs rather than treating them as individual issues. IIF has conducted climate-related analysis and disclosures based on the TCFD recommendations, and will continue to progressively consider the integration of nature-related and climate-related issues going forward.
Short-term: 1 year / Medium-term: up to 10 years / Long-term: up to 2050
IIF is committed to building good relationships with a diverse range of stakeholders. For information on stakeholder engagement and KJRM's approach to human rights, please refer to “Communication with Stakeholders” and “Approach to Human Rights”.
The matters resolved by and reported to the Sustainability Committee chaired by the Chief Sustainability Officer (CSO) are overseen and supervised by being reported as needed to the Board of Directors of KJRM Holdings, which is chaired by the President & CEO who also serves as CSO and meets at least once every three months, as well as the Board of Directors of the investment corporation, which meets at least twice a month in principle.
The Sustainability Committee, which is held once a quarter in principle, identifies material dependencies, impacts, risks and opportunities related to sustainability, including climate change and natural capital and plays a central role in sustainability activities by resolving policies, strategies, systems, and goals, and monitoring KPIs.
For details, please refer to “Sustainability Promotion Structure” .
In addressing nature-related issues and other sustainability challenges, KJRM places importance on communication with stakeholders, including local communities, tenants, and PM and BM companies. Engagement is carried out at managed properties, taking into account local characteristics and consideration for the surrounding environment.
In addition, based on the Sustainable Procurement Policy, KJRM promotes respect for human rights and consideration for biodiversity in procurement activities related to IIF's business operations, including supply chains.
For details, please refer to “Communication with Stakeholders” and “Sustainable Procurement Policy”.
The status of dependencies and impacts on environmental issues and identified risks and opportunities are assessed based on business activities, local characteristics, and interfaces with nature. In addition, with respect to natural capital, priorities are established taking into account relationships with sensitive locations. Analysis and assessment are conducted primarily by sustainability staff, taking into account the characteristics of IIF's managed assets. Currently, analysis is centered on real estate leasing activities; analysis covering the value chain will be progressed in stages, taking into account constraints in data acquisition and the complexity of analysis. The status of dependencies and impacts, identified risks and opportunities and their degree of impact, and priority locations are discussed and confirmed by the Sustainability Committee.
Led by the person in charge of sustainability, we establish meetings (hereinafter referred to as "subcommittees") as necessary to discuss and examine in detail sustainability-related issues, including environment-related issues, and approaches to promoting sustainability at the working level, either within a division or in cooperation with other divisions. Through the subcommittees, individual issues are discussed and information is shared to raise awareness and understanding among those in charge, while integrating sustainability considerations into the daily investment and asset management processes.
Matters discussed and considered by the subcommittees are reported to the Sustainability Committee, which monitors their progress.
In addition, IIF collects and monitors environmental data for their properties on a monthly basis. To promote initiatives related to environmental matters, including climate change-related metrics, targets, and initiatives, and to collect environmental data, IIF has established an Environmental Management System and continuously strengthen and improve these initiatives through the implementation of the PDCA cycle.
In addition, at the priority locations identified IIF Shonan Health Innovation Park regular monitoring of flora and fauna is conducted to understand the natural environment within the green spaces of these properties.
We operate the Risk Management Committee at KJRM Holdings, the holding company of the asset management company, as a forum for identifying and examining matters related to major risks and formulating countermeasures and management policies. The Committee is composed of senior management personnel and utilizes the Risk Control Matrix (RCM) to review, once every three months, the status of environment-related dependencies, impacts, risks, and opportunities, including those related to climate change and biodiversity, as well as other risks and opportunities affecting business operations. These matters are then reported to the Committee for evaluation and management.
IIF recognizes that human life and economic activities are founded on natural capital, including biodiversity.
The TNFD recommendations encourage the use of the 'LEAP approach' as a means of identifying and assessing the relationship between business activities and nature. With reference to this process, IIF analyzed dependencies and impacts on nature based on interfaces with nature, and identified priority locations.
To assess dependencies and impacts on natural capital in the sector to which IIF belongs, IIF used 'ENCORE,' a representative tool recommended for use in the TNFD recommendations, to assess the degree of dependency and impact. IIF considered dependencies on and impacts to natural capital that merit attention in the real estate sector, with direct operations defined as real estate business activities involving owned or leased properties. In these considerations, the status of relevant initiatives at IIF was also taken into account in identifying dependencies and impacts.
In the current analysis, visual comfort is assessed as a high-dependency item. In the real estate business, visual elements such as landscapes and green spaces play an important role in providing an attractive environment for residents and users. Locations rich in nature, such as areas surrounded by greenery or near parks, are considered one of the elements that enhance the appeal of real estate assets. In addition, it is recognized that land use and water use in real estate operations may have a certain impact on species, water, and habitats. Based on the relationship of dependency on and impact to natural capital, potential risks and opportunities for the business arising from future changes in the natural environment were identified.
Three evaluation criteria related to nature were established, and all assets in the IIF portfolios were assessed. Based on the results, potential priority location candidates were selected, and taking into account proprietary considerations such as relationships with sensitive locations and acquisition prices, IIF Shonan Health Innovation Park was identified as priority locations.
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| Evaluation Item | Data and Sources Referenced |
|---|---|
| Dependencies on and impacts to natural capital | ENCORE assessments, GHG emissions, water consumption, waste volume, land area |
| Geographic location | Protected areas (nature conservation areas, wildlife protection areas, important marine areas, etc.), Key Biodiversity Areas (KBAs) |
| Water risk | Aqueduct water risk atlas (Water Stress) |
Based on ENCORE assessments, the dependency and impact relationships between business operations and natural capital were identified, and quantitative data on GHG emissions, water consumption, waste volume, and land area were used to assess the environmental footprint of each property. The relationship between properties and protected areas was also examined, along with water risk in the areas where properties are located (total water withdrawal in the watershed ÷ renewable water resources), and a comprehensive assessment was conducted from the perspective of future business risk.
IIF is conducting scenario analysis based on the TNFD recommendations to understand the impact of nature-related issues on its business activities.
The TNFD recommendations require organizations to 'describe the resilience of the organization's strategy to nature-related risks and opportunities, taking into consideration different scenarios.' On the other hand, unlike the TCFD recommendations, there are no unified normative scenarios. Therefore, with reference to the TNFD recommendations and external scenarios, the following two scenarios were established.
As interest in nature grows and policies become established, nature is broadly maintained and restored overall, though some vulnerable areas continue to degrade.
Nature degradation continues and business impacts are becoming apparent, but policies have not taken hold and countermeasures remain ad hoc.
[Referenced External Scenarios and Materials]
■ Transition Risks/ Opportunities
TNFD 'TNFD Recommendations'
IPBES 'Global Assessment Report on Biodiversity and Ecosystem Services' (2019)
Ministry of the Environment 'Interim Evaluation of the Implementation Status of the National Biodiversity Strategy 2023-2030' (February 2026)
■ Physical Risks/Opportunities
ENCORE
The IPBES 'Global Assessment Report on Biodiversity and Ecosystem Services' (2019) is a report that scientifically shows the current state, causes, and future of biodiversity decline, and points to the difficult path to realizing a sustainable society in the face of the degradation of nature we face, while also suggesting the possibility of realizing a sustainable society through societal transformation. This report's scientific projections for the future of nature were referenced in conducting the scenario analysis. For information on the status and challenges of domestic biodiversity and future policy direction, the Ministry of the Environment's 'Interim Evaluation of the Implementation Status of the National Biodiversity Strategy 2023-2030' (February 2026) was referenced.
Stakeholder behavioral changes are defined based on the 'Nature Recovery Scenario' and 'Nature Degradation Scenario.'
| Nature Recovery Scenario (Transition Risks ↑ / Physical Risks ↓) |
Nature Degradation Scenario (Transition Risks ↓ / Physical Risks ↑) |
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|---|---|---|---|---|
| Government / Authorities |
Regulatory tightening and institutionalization of nature-positive policies
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Inadequate preventive measures and sudden regulatory tightening
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| Investors / Financial Institutions |
Progress in capital allocation reflecting natural capital risks and opportunities
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Stricter investment decisions focused on physical risks
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| Tenants |
Expansion of green leases and increased demand for environmentally conscious offices
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Conservative property preferences driven by safety and BCP priorities
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| PM / BM |
Increased operational burden and costs due to advancing nature-related initiatives responses
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Increased operational burden and costs due to expanded disaster response and resource constraints
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| Real Estate Industry |
Strengthening of environmental regulatory compliance and acceleration of sustainability responses initiatives
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Asset selection and cost increases driven by expanding physical risks
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Based on these scenarios, a qualitative analysis was conducted on the risks and opportunities that nature-related issues may pose to assets owned and managed by IIF. An assessment of response measures for identified risks and opportunities was also conducted.
IIF conducted a qualitative assessment of the impact of nature-related issues on business activities and examined response measures for assets held as direct operations.
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| Classification | Risk/ Opportunity Item | Change in Cash Flow (Qualitative) |
Risk/ Opp. |
1：Nature Recovery Scenario |
2：Nature Degradation Scenario |
Efforts and measures | |||
|---|---|---|---|---|---|---|---|---|---|
| Medium term (~10 yrs) | Long term (2050) | Medium term (~10 yrs) | Long term (2050) | ||||||
| Transition Risks/ Opportunities | Policy | Increase in regulatory compliance costs | Increase in compliance costs due to tightening environmental regulations | Risk | Medium | Medium | - | Medium |
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| Increase in operational environmental compliance costs (certification acquisition, green space management, etc.) | Risk | Small | Medium | - | Small | ||||
| Improvement of property competitiveness through environmental regulatory compliance | Opportunity | Small | Medium | - | Medium | ||||
| Market | Changes in awareness of nature among market participants | Increase in financing costs due to lower valuation of properties with high environmental impact | Risk | Small | Medium | - | Small | ||
| Changes in awareness of nature among tenants | Extended vacancy periods at properties with low environmental performance due to nature and environmental performance screening at occupancy | Risk | Small | Medium | - | Small | |||
| Increase in appraised value and average rent for properties with high nature consideration and environmental performance | Opportunity | Small | Medium | - | - | ||||
| Technology | Spread of environmental impact reduction technologies | Increase in various implementation costs due to environmental impact reduction measures | Risk | Small | Large | - | Medium |
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| Reduction in utility costs such as water and electricity through environmental impact reduction measures | Opportunity | Small | Large | - | - | ||||
| Reputation | Decline in credibility due to delayed environmental measures | Decline in asset value of properties with high environmental impact | Risk | Small | Medium | - | Medium |
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| Litigation costs arising from adverse impacts on the surrounding environment due to delayed environmental measures | Risk | Medium | Medium | - | Medium |
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| Revenue increase and reduction in financing costs through improved selectivity as surrounding environmental quality improves through promoting environmental measures | Opportunity | Small | Large | - | Small |
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| Physical Risks/ Opportunities | Acute Risks |
Increase in typhoons, heavy rainfall, storm surges, floods, and inundation | Increase in repair and prevention costs, and insurance premiums | Risk | Medium | Medium | Medium | Large |
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| Improvement of market competitiveness through implementation of BCP and resilience strengthening measures | Opportunity | Small | Medium | Small | Medium | ||||
| Occurrence of infectious diseases | Decrease in rent due to operating losses | Risk | Small | Medium | Medium | Medium | |||
| Chronic Risks |
Rise in average temperature | Increase in air conditioning maintenance, repair costs, and utility costs due to increased cooling demand | Risk | Medium | Medium | Medium | Medium |
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| Changes in precipitation | Decrease in rent due to operating losses | Risk | Small | Medium | Medium | Medium | |||
Short-term impacts from nature-related issues are currently considered to be limited.
The implementation of quantitative analysis of nature-related issues and the expansion of the scope of analysis to include the value chain will be considered in stages, taking into account the external environment and the status of data preparation.
With reference to the LEAP approach of the TNFD recommendations, a qualitative assessment of nature-related dependencies, impacts, risks and opportunities has been conducted for the entire portfolio, as described in the scenario analysis above. In addition, given the highly location-specific nature of nature-related issues, a separate, detailed assessment tailored to local characteristics has been conducted for the priority location. For IIF, the following assessment was conducted for IIF Shonan Health Innovation Park, identified as the priority location.
All areas where IIF's properties are located meet at least one of the criteria for a sensitive location and could thus be a candidate priority location. However, based on the scale of green spaces, the status of certification acquisition ( Nationally Certified Sustainably Managed Natural Sites under the Act on Promoting Activities to Enhance Regional Biodiversity, recognizing areas where biodiversity is conserved through private initiatives (hereinafter referred to as " Nature Symbiosis Site") certification obtained in 2025), relationships with surrounding nature, and other dependencies and impacts on nature, IIF Shonan Health Innovation Park in the Fujisawa area has been identified as the priority location.
Policy | Increase in regulatory compliance costs: Based on the environmental preservation agreement, IIF collaborates with local municipalities to advance initiatives contributing to environmental conservation. In 2025, the biodiversity value of the green spaces within the site—including the provision of a healthy ecosystem centered on native species and their function as a habitat for rare plants—was recognized, and ' Nature Symbiosis Site ' certification was received.
Market | Changes in awareness of nature among market participants and tenants: In compliance with green space management policies, tree and grass preservation, rare species conservation, and pathway maintenance are carried out in collaboration with specialist institutions. Part of the green space is periodically opened to local residents, advancing its use as a community-accessible space. LED lighting is also used to suppress light pollution.
Market | Regional collaboration and ecosystem network: The green space within IIF Shonan Health Innovation Park—known as 'Shonan iPark Green Space'—is positioned as a base of the ecological network in the area, as a precious woodland environment remaining amid the urbanization of the surrounding area. Monitoring of rare plants and insects is conducted in collaboration with specialist institutions, and biodiversity-conscious mowing and pruning are carried out to build a foundation for a diverse ecosystem centered on native species. Part of the green space is also periodically opened to local residents, providing a place for community connection with nature.
Comparison with satellite imagery from around 1990 shows that the western and northern sides of IIF Shonan Health Innovation Park have transformed into residential areas. Amid the surrounding land development, IIF Shonan Health Innovation Park has continuously worked to preserve the green spaces within its site. In 2025, ' Nature Symbiosis Site ' certification was received, recognizing the important role the property's green spaces play as a habitat for rare plants and diverse native flora and fauna, and as a place providing local residents with opportunities to connect with nature.
Land Use Change around IIF Shonan Health Innovation Park
Technology | Spread of environmental impact reduction technologies: IIF Shonan Health Innovation Park is the first research facility to be selected by the Ministry of Land, Infrastructure, Transport and Tourism's Model Project for Promoting GHG Reduction in Housing and Building, featuring an environmentally conscious building design. It adopts a passive design utilizing natural energy and active technologies for energy efficiency. In August 2021, electricity procurement was switched to electricity derived from renewable energy sources in line with RE1ces00 standards.
Reputation | Decline in credibility due to delayed environmental response: Through engineering reports, nature-related impact risks such as water quality and soil contamination have been confirmed. In addition, low-toxicity pesticides and herbicides are selected in consideration of impacts on ecosystems, and only used in a spot-specific manner on a minimum-impact basis when pests occur, reflecting efforts toward appropriate chemical management.
Acute | Increase in typhoons, heavy rainfall, storm surges, floods, and inundation:Flood and inundation risks have been confirmed through hazard maps.
Acute | Occurrence of infectious diseases:The development of outdoor green spaces remaining in an urban area contributes to enhancing the comfort of the surrounding environment.
Chronic | Rise in average temperature:Woodland areas exceeding 5 ha, maintained with tall trees such as Japanese black pine (Pinus thunbergii), sawtooth oak (Quercus acutissima), and Japanese stone oak (Lithocarpus edulis), serve as precious green hubs in the surrounding residential area, contributing to urban heat island mitigation.
Land surface temperatures in summer were compared around IIF Shonan Health Innovation Park. The green space area of Shonan iPark showed a temperature difference of up to approximately 10°C compared to adjacent residential areas, confirming that the green spaces of Shonan iPark play a role in urban heat island mitigation.
Chronic | Changes in precipitation:The water retention function of green spaces contributes to adaptation to changes in precipitation. Climate change scenarios are reviewed periodically, and responses are being considered.
IIF has set environment-related metrics and targets as shown below.
Going forward, we will continue to examine metrics for managing nature-related dependencies, impacts, risks and opportunities, with reference to the disclosure metrics recommended by the TNFD.
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| Metrics | Target | Performance | TNFD Measurement Indicator No. |
|---|---|---|---|
| GHG Emissions | Reduce total GHG emissions by 42% compared to FY2021 (Scope 1 & 2, target year: 2030) | Environmental Performance | ー |
| Water consumption | - Reduction of water consumption - Intensity-based change: ±0% compared with FY2021 (target year: FY2030) |
C2.1 | |
| Recycling rate for properties under the Investment Corporation’s controllable management scope | Improved compared with FY2022 (FY2022 recycling rate: 40.5%) | C2.2 | |
| Biodiversity-related certifications | Maintain existing certifications | Initiatives for Biodiversity | C1.1 |
| Ratio of environmentally certified properties | - Logistics facilities: 70% or higher - Portfolio-wide certification: 60% or higher (target year: 2030) |
Environmental Certification | A15.0 |
IIF recognizes the critical importance of what ecosystems can provide, and has established green zones on its properties and checks for soil contamination in order to mitigate any potential impacts on natural capital and contribute to its preservation.
IIF Shonan Health Innovation Park opens up part of its green space to local residents every Sunday, providing them a place where they can enjoy a stroll in nature.
The green space within IIF Shonan Health Innovation Park, called Shonan iPark forested area, has been certified as a Nationally Certified Sustainably Managed Natural Sites under the Act on Promoting Activities to Enhance Regional Biodiversity, recognizing areas where biodiversity is conserved through private initiatives. In August 2026, the site was also registered in the international OECM database.
OECM (Other Effective area-based Conservation Measures): Areas that contribute to the conservation of the natural environment through management and conservation efforts by private entities and other stakeholders. Progress toward the 30 by 30 target—an international goal to conserve and protect at least 30% of the world's terrestrial and marine ecosystems by 2030—will be assessed based on the comprehensive international database of protected areas and OECMs.
For details, please see "Protected Planet".
Community Engagement
IIF Shonan Health Innovation Park:
Environmental preservation agreement with Fujisawa City and Kamakura City
IIF recognizes the critical importance of what ecosystems can provide and is committed to protecting ecosystems and mitigating any potential impacts on biodiversity.