Tokyu Land, the Development Bank of Japan (DBJ) and Kenedix have purchased the former head office of the Shinsei Bank in Chiyoda-ku from a Morgan Stanley fund for 50 billion Yen (605 million USD) – less than half what Morgan Stanley paid for it in 2008.

The new owners plan to demolish the 19-year old building and replace it with a new one. The total cost of the project, including purchasing the existing building, is estimated at 80 billion Yen (970 million USD).

Demolition will commence in 2013 and the new 20-storey building will be completed in 2017. The new building will have a total floor area of 57,500 sqm, and will be almost the same scale as the current building, which is 60,000 sqm. However, the new building will have more leasable floor space.

DBJ believes the real estate market has bottomed out and have begun to intensity their investment activities.

The building was constructed in 1993 to house the head office of the Long-Term Credit Bank of Japan (LTCB). The LTCB was restructured as Shinsei Bank in 2000, and Shinsei used the building as their head office.

Morgan Stanley’s fund purchased the building from Shinsei’s subsidiary, Dolphin Japan Investment, in 2008 for 118 billion Yen. Shinsei moved out of the building in 2010 and it has remained vacant since then.

Location: 2-1-8 Uchisaiwaicho, Chiyoda-ku, Tokyo

Source: The Nikkei Shimbun, December 6, 2012.

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