Japan Real Estate Report Q3 2011
Includes 3 FREE quarterly updates
The earthquake and subsequent tsunami that ravaged Japan’s seaboard in March wreaked havoc on the real estate sector. New research claims that the damage from the Japanese earthquake has affected around US$700bn worth of insured property, according to the Wall Street Journal. The tsunami also hit areas with an estimated US$24bn-worth of insured property.
This comes on top of existing and well-known structural problems in the sector, with the government under pressure to rein in its massive debt. These long-term problems led to an average land price decrease of 3% in 2010, following a drop of 4.6% the previous year. The improvement was due to recovering demand in the real estate market, which saw Japanese real estate investment trusts (REITs) double their acquisitions during the year. This is likely to be reversed as investors hang back in the wake of the earthquake and tsunami – and subsequent slump in consumer and business confidence. Vacancy rates have already risen to 9.2% and 12.4% in Tokyo and Osaka respectively, from 9.1% and 11.9% in February. Hiring demand at regional offices outside Tokyo has also picked up since the earthquake.
Despite the gloomy outlook for the sector there is some positive news in the government announcement that it will build 100,000 new temporary homes. The developments will house those evacuated from their homes due to the tsunami and earthquake and are expected to cost US$50bn.
The earthquake and subsequent tsunami that ravaged Japan’s seaboard in March wreaked havoc on the real estate sector. New research claims that the damage from the Japanese earthquake has affected around US$700bn worth of insured property, according to the Wall Street Journal. The tsunami also hit areas with an estimated US$24bn-worth of insured property.
This comes on top of existing and well-known structural problems in the sector, with the government under pressure to rein in its massive debt. These long-term problems led to an average land price decrease of 3% in 2010, following a drop of 4.6% the previous year. The improvement was due to recovering demand in the real estate market, which saw Japanese real estate investment trusts (REITs) double their acquisitions during the year. This is likely to be reversed as investors hang back in the wake of the earthquake and tsunami – and subsequent slump in consumer and business confidence. Vacancy rates have already risen to 9.2% and 12.4% in Tokyo and Osaka respectively, from 9.1% and 11.9% in February. Hiring demand at regional offices outside Tokyo has also picked up since the earthquake.
Despite the gloomy outlook for the sector there is some positive news in the government announcement that it will build 100,000 new temporary homes. The developments will house those evacuated from their homes due to the tsunami and earthquake and are expected to cost US$50bn.
Contents
Executive SummarySWOT Analysis
Japan Real Estate/Construction SWOT
Japan Economic SWOT
Japan Business Environment SWOT
Real Estate Market Overview
Table: Japan’s Real Estate Market – Rents, 2009 And 2010 (m2/month, US$)
Table: Japan’s Real Estate Market – Net Yields, 2010 And 2011 (%)
Table: Japan’s Real Estate Market – Terms Of Contract/Lease
Table: Japan’s Real Estate Market – Available And Vacant Space (m2 unless otherwise stated)
Industry Forecast Scenario
Real Estate Outlook
Table: Japan’s Real Estate Market – Rentals, 2010-2012 (m²/month, US$)
Table: Japan’s Real Estate Market – Forecast Yield, 2008-2015 (%)
Construction Industry Outlook
Table: Japan Construction And Infrastructure Industry Data
Table: Japan Construction And Infrastructure Industry Data
Macroeconomic Outlook
Table: Japan – Economic Activity, 2008-2015
Business Environment
Real Estate/Construction Business Environment Rating
Table: Asia Real Estate/Construction Business Environment Ratings
Japan’s RECBER
Japan’s Business Environment
Table: BMI Business And Operation Risk Ratings
Table: BMI Legal Framework Rating
Table: Labour Force Quality
Table: Asia, Annual FDI Inflows
Table: Trade And Investment Ratings
Table: Top Export Destinations
Competitive Landscape
Company Profiles
Kajima Corporation
Kumagai Gumi
Obayashi Corporation
Sanyu Construction
Sekisui House
Shimizu Corporation
Sumitomo Real Estate Sales
BMI Methodology
How We Generate Our Industry Forecasts
Construction Industry
Bank Lending
Real Estate/Construction Business Environment Rating
Table: Weighting Of Indicators
Project Finance Ratings Indicators
Table: Design And Construction Phase
Table: Commissioning And Operating Phase – Commercial Construction
Table: Commissioning And Operating Phase – Energy And Utilities
Table: Commissioning And Operating Phase – Transport
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