Canadian firm to invest US$9.5 billion in Japanese real estate

On October 12, the Nikkei newspaper reported that Canadian investment firm BentallGreenOak (BGO) plans to invest up to 1 trillion Yen (approx. US$9.5 billion) in Japanese real estate over the next two to three years. The company is anticipating that corporations will start selling off their office and hotel real estate holdings as the global pandemic continues, creating buying opportunities. 

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Shinjuku office vacancy rate drops to 1% range

The office vacancy rate across Tokyo’s five central business districts of Chiyoda, Chuo, Minato, Shinjuku and Shibuya dropped to 3.22% in July, down 0.04 points from June and down 0.72 points from July 2016. This is close to the record low of of 3.03% reported in April 2008 and down from a high of 9.43% seen in June 2012.

The vacancy rate in existing buildings (excluding new construction) was 2.87% in July, down 0.74 points from last year.

In Shinjuku ward, the vacancy rate was 1.68%, down 0.06 points from the previous month and down 1.30 points from last year. The vacancy rate dropped to the 1% range in May 2017.

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Shiba Park Building returns to the market

Shiba Park Building 2

Shiba Park Building, a landmark office building in central Tokyo, is being offered for sale again, with insiders suggesting it could sell for more than 160 billion Yen (1.3 billion USD). *Update: Several months later, the owners decided to take advantage of low borrowing rates to refinance rather than sell the building, with the net rental income providing a more attractive return than disposal of the asset.  

The 14-storey building has a total floor area of 103,000 sqm (1.1 million sq.ft), of which 83,000 sqm is leasable space. It was built in 1982 by Shuwa Corporation, a real estate developer that invested heavily in US properties during Japan’s bubble economy in the late 1980s. Shuwa was also the developer of numerous ‘Shuwa Residence’ vintage apartment buildings built across Tokyo and Saitama in the 1960s and 1970s.

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