Listed companies offload real estate holdings in pandemic

A total of 76 companies listed on the Tokyo Stock Exchange reported the sale of real estate assets in 2020, up from 59 in 2019 and the first time to exceed 70 in four years. Total capital gains from the sales reached 441.6 billion Yen (approx. US$4 billion), the highest in 20 years.

The pandemic has led some companies to shore up funds to cover operating expenses, while the work-from-home trend has led others to reevaluate their need to hold large offices.  

Over 90% of the companies made a gain on the sale of real estate. However, almost 40% of those companies reported an operating loss for the year. Some of those were in the hard-hit service industry.

The big ticket sales were from Nippon Express (50 billion Yen) and NEC Corporation (47 billion Yen). Music label AVEX made headlines late last year with the reported sale of their headquarters in Omotesando, Tokyo. The sale price was not disclosed but insiders suggest it was around 70 billion Yen, netting a profit of 29 billion Yen.

Sales are expected to continue into 2021 as the effects of the pandemic continue.

Source: Tokyo Shoko Research, April 16, 2021.

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