Thai-based property company Pace Development has sold a 14 hectare block of land in Hokkaido’s Niseko area for 2.05 billion Yen (approx. 18.8 million USD). The buyer was Richforest International Investments Ltd.
Pace had previously acquired the land in 2016 for approximately 1.56 billion Yen, resulting in a 30% gain over the past 18 months.
According to the Ministry of Land, Infrastructure, Transport and Tourism (MLIT), approximately 41,000 square kilometers, or 20% of privately-owned land in Japan is owned by unidentifiable or missing owners.
A missing owner is defined as someone who has either passed away without the property title being transferred to the heirs, or an owner who has since moved but has not updated their address details on the property title. Generally speaking, there is no legal obligation to update a change of address or inheritance on property titles.
Of the land, 14% is building land, 18.5% is farmland, and 25.7% is forestry. The MLIT reported that 19.8%, or 930,000 hectares, of Japan’s agricultural land has property titles that have not been updated in over 50 years. Some local governments have found property titles showing the owner’s address as Manchukuo – a short-lived pre-war puppet state located in northeastern China.
Nara Prefecture is accepting bids from private companies for a hotel development to be located within the Nara Park grounds in Nara City. The 1.3 hectare site is located on the southern side of Nara Park’s Ukimi-do Hall, and was purchased by the prefecture from the national government in 2005.
Prior to the Meiji Restoration, the property was home to one of Kofuku-ji’s sub-temples. In 1890 it was sold to Nara poet Haruyasu Umeda (1850-1917). From 1911, it became the holiday villa of Kenshiro Yamaguchi (1886-1957), a wealthy banker and president of the Kansai Trust Bank (the predecessor of the Toyo Trust Bank, which is now part of the Mitsubishi UFJ Trust and Banking Corporation). After WWII, the annex of the Nara Family Court was built on the land. The land is currently vacant although traces of the original Japanese garden remain.
If you are buying land or a house and land in Japan, it is essential to understand how land sizes are measured and represented on contract documents.
Measured size vs. registered size
Each parcel of land has a size that is registered on the land title. This size is decided by the Legal Affairs Bureau and may vary from the actual size of the land for various reasons, primarily due to outdated survey methods used in the past.
It is possible for the seller to hire a surveyor to measure the actual size of the land. However, many may choose not to due to the cost involved.
Quite often the surveyed size will be different to the registered size, although there is no general rule as to how much they differ. A property owner may apply to update the land register to show the true size of the land, but permission from adjoining landowners will be required since their land registers must also be updated. This can be extremely difficult, as neighbours would not consent if it would result in their registered land size being reduced. Many do not bother to go through with this process.
The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) announced this year’s Standard Land Prices on September 20.
Nationwide, land prices declined for the 25th year in a row with a 0.6% decrease, although the rate of decline is slowing. Meanwhile, commercial land prices stopped their downwards trend for the first time in 9 years.
Land prices in Japan’s urban centres of Tokyo, Osaka and Nagoya continued to benefit from booming foreign tourist numbers, redevelopment and infrastructure projects, shrinking office vacancy rates, and monetary easing.
Commercial land prices in these three cities increased by 2.9%, representing a fastening pace after 2.3% growth in 2015 and 1.7% growth in 2014. In the Tokyo metropolitan area, commercial land prices increased by 4.1% in 2016, after a 3.3% increase in 2015. In Osaka city, they were up 4.7% this year.
Fujidera City in Osaka Prefecture has filed a lawsuit seeking the transfer of ownership of land containing a 1,500 year-old ancient tomb.
Called a ‘kofun’, the ancient tomb is part of the Mozu and Furuichi Kofun-gun group of tombs constructed between the 3rd and 7th century AD in the Osaka area. The city is hoping to have the tombs registered as UNESCO World Heritage Sites, and owning the land would help to ensure its protection and preservation.
This is a large 7,600 sqm block of residential land in Kamakura that was originally the estate of Tsusai Sugahara (1894-1981), a famous Japanese industrialist and developer Japan’s first tollroad which ran between Ofuna and Enoshima in the 1930s. In 1929, Sugahara relocated a grand samurai residence dating from the 1620s to this land to be used as his personal residence.
After his passing, his wife operated the house as a high-end restaurant called Sanki-en for several years. The restaurant closed over 15 years ago and the building fell into ruin. The building was purchased by a local company and carefully relocated off-site over the span of 12 months in 2014. It is now an Italian restaurant called Trattoria Mokichi in nearby Chigasaki.
According to Japan’s National Tax Agency, rosenka land values across Japan in 2016 increased by 0.2% from 2015. This is the first time to see an increase in the nationwide average since pre-global financial crisis in 2008.
Recent monetary easing measures, strong activity in the real estate market in central Tokyo and a surge in the number of foreign tourists are behind the increase in land prices.
Tokyo was in top place with an average increase of 2.9%. Land near the Kyukyodo Building in Ginza remains the most expensive land in Japan for the 31st year in a row. The rosenka land value in 2016 was 32,000,000 Yen/sqm (29,000 USD/sq.ft), up 18.7% from 2015 and has exceeded pre-Lehman Crisis pricing. This land reached a peak of 36,500,000 Yen/sqm in 1992, before dropping to 11,360,000 Yen/sqm in 1997.
Land alongside Omotesando Avenue in Tokyo had a rosenka value of 10,070,000 Yen/sqm in 2016, up 14.2% from 2015.
Mitsubishi Jisho Residence and Cosmos Initia have acquired a large development site near Shibuya Station. Details have yet to be announced, but industry insiders suggest that, given the size of the land, it could be slated for a luxury condominium project.
Update: The project is called The Parkhouse Shibuya Nanpeidai. Pre-sales for Hong Kong-based buyers began in September 2017, with prices starting from around 145 million Yen. The 10-storey building will have approximately 100 apartments with completion by May 2019 or later.
The 3,300 sqm (35,500 sq.ft) site in Nanpeidaicho is located near the Cerulean Tower Tokyu Hotel and a 5 minute walk from Shibuya Station’s South Exit. It was purchased from Japan Tobacco for an undisclosed price estimated somewhere in the several billion Yen range. The site included a 5-storey office building which is currently being demolished.
For the first time in 8 years, commercial land prices in Japan saw an increase from the previous year. According to the 2016 ‘chika-koji’ assessed land values released by the Ministry of Land, Infrastructure, Transport and Tourism (MLIT), the nationwide commercial land price increased by 0.9% from 2015.
In the Tokyo metropolitan area, commercial land values increased by 4.1% in 2016, up from a 2.9% increase in 2015.
The increase can be attributed to improving office conditions in city centres, and a surge in construction of hotels to meet the growing number of foreign tourists.