Nomura Real Estate Master Fund (TYO:3462) is acquiring the H'O Aoyama serviced office building in Tokyo from Nomura Real Estate Development for 4.7 billion yen.

Concurrently, the fund will dispose of the 50-year-old NMF Takebashi Building, also to Nomura Real Estate Development, for 8.93 billion yen, according to its Tokyo bourse filing on Wednesday.

The transaction is an asset replacement strategy, upgrading the portfolio by acquiring a modern property with a 97.4% occupancy rate while divesting an older asset facing rising repair costs and lower competitiveness.

As both parties are related, the deal was reviewed and approved by the fund's compliance and investment committees.

The net proceeds from the disposition will be used to fund the acquisition, and the swap is expected to enhance the fund's medium-to-long-term stable income.