Is It Bubble Time Again for Japan’s Real Estate Companies?

Japan’s real estate firms are entering dangerous territory. That’s the assessment of S&P Global Ratings, which said in a report Friday that the sector’s debt levels now eclipse that of the nation’s bubble era. “Japan’s real estate market is peaking out and ready to head down,” S&P said. “Although the conditions in the office leasing market are solid, there are signs of a slowdown in corporate earnings, particularly among manufacturers. In addition, we expect major upticks in central Tokyo office building supply in 2020 and 2023.” Companies most at risk are Mitsubishi Estate Co., Mitsui Fudosan Co., Sumitomo Realty & Development Co. and Nomura Real Estate Holdings Inc.