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Let us now take a look at how we perceive the business environment of our main businesses.
While no major fluctuation in either vacancy rate or rent has been observed in the Group’s office building business, our performance alternates between favorable and unfavorable depending on the area.
In the Shibuya area, the core area of the Group’s operations, characteristics such as a large number of growth enterprises have yielded ongoing favorable performance. We foresee the tight balance between supply and demand there to continue for some time.
A recovery in the performance of the Group’s commercial facilities business progressed predominantly with suburban facilities and food and beverage establishments in urban facilities. Conversely, merchandisers continue to be impacted by their being replaced by e-commerce.
Our current efforts include attracting tenants who cater to the needs for experience-based or empathy-based consumption.
In the condominium market, there continues to be inclination among customers to acquire property amid the backdrop of low interest rates and an anticipated rise in prices.
Although there has been no immediate impact observed, we need to continue closely monitoring future trends in interest rates and construction costs as we move forward.
The expansion of the market owing to the trend of decarbonization continues in our renewable energy business. At the same time, competition over acquiring new transactions has intensified.
Additionally, new demand for likes of PPA models has come to the surface in like with the spike in power prices in recent times.
In our hotel business, there is a clear recovery trend in domestic demand as well as inbound demand due to the relaxing of regulations.
Sales of memberships, condominium hotels and so forth are progressing favorably.
The real estate agents business and the real estate transaction market continue to show briskness, particularly for offices, rental housing, logistics facilities and other assets. Furthermore, real estate transactions for hotels and commercial facilities are also trending towards recovery.
Due to the impact of the devaluated yen, there also continues to be a trend of market entry by overseas players who seek to purchase properties.
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