Nomura Real Estate Development added the 14-story Zen Plaza building to their collection of assets. The building is located at Vietnam's Ho Chi Minh City. Nikkei Asia reported that the transaction was completed in July, with Nomura also acquiring the company that owned the tower.
This was the second acquisition that Nomura completed after obtaining a controlling interest in the Sun Wah Tower, making it the company's second rental office building in the city. Ho Chi Minh City is Vietnam's largest commercial hub, which is located 1,700 km south of Hanoi.
The building is also a 12-minute drive from Saigon Station and is close to Nguyen Trai Street, where a lot of clothing stores are also located. The city's business hubs are within reach of the location. It features a total floor space of 17,000 sq meters with 11,700 sq meters available for lease.
Nomura considers its overseas business as one of its growth fields, as seen in its latest mid- to the long-term business plan. The company is steadily investing in foreign operations and it plans to put about $2.7 billion in foreign operations once its fiscal year in March 2028 ends.
Nomura's plans operate outside of the risk that appears to be bearing down on Japanese real estate. According to Bloomberg, the assessment of S&P Global Ratings is that Japan's real estate firm s are prone to experiencing yet another "bubble era" with the sector's debt levels eclipsing those that were made during that time.
S&P shared its analysis that the real estate market of the country "is peaking out and ready to head down." The conditions in the office leasing market are "solid" but there are indications that corporate earnings are going down, specifically those among manufacturers. There are also "upticks" pertaining to the central Tokyo office building supply in the years 2020 and 2023.
Interest rates in Japan had been low for years, although domestic lenders have seen profitability weaken because of interest margins becoming lower. They've also increased loans to developers since other corporate customers haven't been demanding as much, leading to a weak market.
Nomura is doing well outside of Japan, with the company looking at overseas operations to account for between 15% to 20% of its total revenue. They are also looking into expanding their business. Nomura is planning to have a significant presence in Southeast Asian countries such as Thailand, Vietnam, the Philippines, and China.
