Fire insurance policy terms reduced, Blackstone to acquire 8 hotels, and apartment asking prices in Tokyo increase for 8th month in a row. Below is a quick weekly summary of some of the recent goings-on in the Japanese real estate market.
Fire insurance policies to be shortened to 5-year contracts
Starting in 2022, fire insurance contracts for homes and apartments will be shortened from their current maximum of 10 years to just 5 years. This is in response to an increasing number of insurance payouts by major providers in recent years due to severe rain and typhoons. Typhoon Jebi in 2018 saw insurance payouts of 1.5 trillion Yen (approx. 13.7 billion USD) across Osaka and Wakayama prefectures, while Typhoon Faxai in 2019 saw payouts of just over 1 trillion Yen (approx. 9.2 billion USD) in Chiba and Kanagawa.
Kintetsu to sell 8 hotels to Blackstone in October
Kintetsu Group Holdings, the owner of the Kintetsu Railway Line, is selling eight hotels to The Blackstone Group for an undisclosed price. Kintetsu will continue to operate the hotels. The sale will include the Miyako Hotel Kyoto Hachijo, Hotel Kintetsu Universal City (Osaka), and Kobe Kitano Hotel. A total of 2,294 rooms will be sold. The book value of the 8 hotels is 42.3 billion Yen, with insiders suggesting the properties will be sold for around 60 billion Yen. Kintetsu will retain ownership of the remaining 16 hotels in their portfolio, including The Westin Miyako Kyoto, and Sheraton Miyako Hotel Tokyo.
Apartment asking prices in Tokyo increase for 8th consecutive month
According to Tokyo Kantei, the average asking price of a 70 sqm (753 sq.ft) second-hand apartment in Tokyo’s 23 wards in February has seen a month-on-month increase for the 8th month in a row. The average asking price was 60,710,000 Yen, up 0.5% from the previous month and up 7.1% from last year. In the central wards of Chiyoda, Chuo, Minato, Shinjuku, Bunkyo, and Shibuya, the average was 88,560,000 Yen, up 0.8% from the previous month and up 8.0% from last year. In Chiyoda ward, which includes the wealthy residential area of Bancho to the west of the Imperial Palace, the average has jumped from 100 million Yen in October 2019 to over 120 million Yen last month.
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