Tokyo 2020 Athletes Village

The site for the 2020 Tokyo Summer Olympic’s Athlete’s Village in Harumi, Chuo-ku will be sold to a consortium of developers for 12.96 billion Yen (approximately 127 million USD). This works out to approximately 96,800 Yen/sqm (88 USD/sf), less than sixth of its market value.

The reason for the low sale price is due to the large investment required to develop the 133,906 sqm site. Construction costs for apartment buildings are currently around 300,000 Yen/sqm. With an estimated total floor area of 690,000 sqm, the buildings could cost 207 billion Yen (approx. 2 billion USD).

The group of developers includes some of Japan’s top real estate companies such as Mitsui Fudosan, Mitsubishi Jisho, Nomura, Sumitomo and Tokyu Land.

The project will include 21 residential buildings ranging from 14 to 18 storeys as well as retail facilities. The 2nd to 14th floors in the buildings will be used to provide temporary accommodation for 17,000 athletes and guests.

The Tokyo Metropolitan Government requires the developers to have these buildings completed and ready for handover six months prior to the start of the games. Although they will only be occupied by athletes for a month at most, the apartments will no longer be in new condition once occupied. Under Japanese real estate law, as soon as a brand new apartment is occupied, it can no longer legally be called a ‘new apartment’ and can only be advertised as a used or second-hand property. As a result, developers might not be able to charge the premium price normally attached to brand new apartments.

After the games, the apartments will be made available for sale and rent to the general public. Construction on two 50-storey residential skyscrapers will also begin after the Olympics. By 2024, there will be a total of 23 buildings containing 5,650 apartments.

Tokyo 2020 Athletes Village 3

Tokyo 2020 Athletes Village 2

There are concerns that the large supply of apartments in this development could flood the market. The 5,650 apartments would represent almost 30% of the annual supply of new apartments in Tokyo’s 23 wards.

The village is on a man-made island, with the north-eastern side of the site reclaimed by the early 1930s and the southern side of the site reclaimed by the 1960s. The land is currently below tsunami risk levels and additional land embankments must be added before any buildings can be built.

The site was originally planned to host the 1940 Japan International Exposition to coincide with the 1940 Tokyo Summer Olympics. However, both events were cancelled due to the outbreak of World War II. From the 1950s to the mid-1990s, the site was home to the Tokyo International Trade Fair Hall.

The Nikkei Shimbun, August 2, 2016.
The Mainichi Shimbun, July 28, 2016.