Rising construction costs causing suburban projects to be cancelled
- Apartment developments cancelled.
- Station-front redevelopment projects on hold.
- Slowdown in retail expansion.
Japan’s construction industry is facing an impending crisis as the construction boom brought about by the 2020 Summer Olympics and Tohoku reconstruction is causing construction costs to rise dramatically.
The rising costs and severe labour shortage is having a direct impact on apartment development in the greater Tokyo area.
In April, the Odakyu Electric Railway Company announced that they were cancelling their plans to develop a high-end residential neighbourhood on the site of the former Mukogaoka Amusement Park in Tama-ku, Kawasaki due to rising construction costs which no longer make the project profitable.
Other apartment developers are also taking a restrained approach. Some that have already acquired development sites are either holding off on construction, leaving the sites empty, or are changing their plans.Read more