[Foreclosed] 13 Apartments in Gotenyama Trust Court

 

Court Evaluation: 543,200,000 Yen (7.05 million USD)

*Update: The winning bid was 548,000,888 Yen. Only 1 bid was made on the property and it was by a corporate entity.*

A group of 13 apartments have been foreclosed in Gotenyama Trust Court, near Shinagawa Station. The apartments range in size from 63.24 ~ 317.24 sqm (680 ~ 3413 sqft) and the total floor size is 1,552.83 sqm (16,708 sqft). The Court’s evaluation of the value of the apartments is approximately 379,000 Yen/sqm.

Gotenyama Trust Court is part of Mori Building’s Gotenyama Garden development. The complex includes Gotenyama Trust Tower, Hotel Laforet Tokyo, Gotenyama Trust Court (Garden Residence) and the Gotenyama Park.

Apartments in Gotenyama Trust Court are usually available for rent only and are not normally available for purchase in this building, so it is possible that the current owner was an original landholder who received the apartments as compensation from the developer. The land is owned by Mori Building and several other owners, so these apartments are not freehold and do not come with any land ownership. The leasehold term is 60 years starting in 1978 and ending in 2038.

The Foreclosed Apartments

  • #1424: 183.57sqm
  • #1525: 141.10sqm
  • #1621: 86.92sqm
  • #1622: 76.71sqm
  • #1725: 141.10sqm (Owner-occupied)
  • #1823: 64.78sqm
  • #1923: 64.78sqm
  • #2022: 63.24sqm
  • #2024: 183.57sqm
  • #2123: 64.78sqm
  • #2321: 100.26sqm
  • #2423: 64.78sqm
  • #2521: 317.24sqm
The 24/25th floor 3-bedroom, 3 bathroom + maidroom penthouse. Size: 317.24sqm. Currently rented out by Mori to a tenant for 1,600,000 Yen/month.

Interior Photos:

Rental Details

Mori Trust is currently leasing the 13 apartments from the owner under a 25 year term. The terms of the lease agreement are:
– Start date: May 31, 1990
– End of lease: May 31, 2015
– Monthly rent: 4,191,856 Yen
– Deposit: 79,713,034*

Mori Trust are then subleasing 12 of the apartments while the owner resides in one apartment. Mori is paying the owner rent that is equivalent to 2700 Yen/sqm, while subleasing the apartments out at 5200 Yen/sqm.

*Although the deposit was paid to the original owner at the beginning of the lease term, whoever takes over ownership of the property may be liable to return the equivalent deposit once the tenant moves out even though the deposit went to the former owner. For example, if you purchase a tenanted apartment and the tenant paid a deposit of 1,000,000 Yen to the former owner, you may be liable to return the 1,000,000 Yen deposit to the tenant when they move out.

Earthquake Damage

Mori Trust reported no damage to the common areas of the building, although the interiors of the apartments did suffer some superficial damage during the March 11 Tohoku earthquake. The damage is as follows:

  • Apt 1424: In the south-western corner of the bedroom on the north-western side of the apartment, there is now a 1cm gap between the shelves and the wall in the walk-in closet and a 10cm long crack on the kitchen tiles.
  • Apt 1525: Split in wallpaper in hallway
  • Apt 1725: Split in wallpaper in hallway
  • Apt 1823: Tear in wallpaper in living room
  • Apt 1923: Tear in wallpaper in entranceway, and ceiling in living room.
  • Apt 2024: 1cm gap on kitchen tiles
  • Apt 2123: 1cm crack on plaster in living room between window and ceiling.

Running Costs

In addition to the 79 million Yen deposit, the new owner may also liable for any unpaid management or restoration fees owed to the management company. The total unpaid fees for this building as of April, 2011, were 3,823,584 Yen (49,600 USD).

The total annual fixed asset and city taxes were 9,170,518 Yen (120,000 USD) in 2010.

The total monthly management, restoration fund, water and central heating fees are 2,019,802 Yen/month. These fees must be paid by the owner to the management company each month. Mori Trust said that there is a possibility they will adjust the monthly management and restoration fees after the change in owners.

After deducting the property taxes and management expenses, the annual income from the 13 apartments is 16,894,130 Yen (220,000 USD). If you were to purchase the property at the minimum bid of 434,560,000 Yen, the annual yield would be approximately 3.89% after basic expenses. This is not a particularly impressive yield.

Auction Details

Court Evaluation: 543,200,000 Yen (7.05 million USD)
Minimum Bid: 434,560,000 Yen (5.64 million USD)
Deposit to Bid: 108,640,000 Yen (1.41 million USD)

Bidding Period: November 2 ~ November 10, 2011
Opening of Bids: November 17, 2011

Location

4-7-37 Kita Shinagawa, Shinagawa-ku, Tokyo
Shinagawa Sta. – 10 mins
Kita-Shinagawa Sta. – 5 mins

Property Details

Built: April, 1990
Construction: 25 Stories
No. of units: 113
Construction Company: Kajima Corporation

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