CAPITALAND’S wholly owned serviced residence business unit, The Ascott Limited, will open its second Citadines property in Japan on Monday.

The new Citadines Kyoto Karasuma-Gojo comes a year after the launch of Ascott’s Citadines Tokyo Shinjuku in March 2009.

Lee Chee Koon, Ascott’s managing director for North Asia, said that that property has achieved strong average occupancy of around 80 per cent. ‘It has also received many positive reviews from customers. Hence, we’re expanding our Citadines brand to another key city in Japan.’

The 124-unit Citadines Kyoto Karasuma-Gojo offers studio and one-bedroom apartments with contemporary decor, modern fittings, a fully-equipped kitchen, a home entertainment system and broadband Internet access.

It is located in Gojo, a short walk from the city’s business district and tourist belt where there are many shopping malls, supermarkets, restaurants and entertainment facilities. Renowned Unesco World Heritage sites the Kiyomizu Temple and Toji Temple are less than a 10-minute drive away.

The property is also near Gojo subway station. And Kyoto’s largest downtown shopping area, Shijo Street, and the Kyoto Shinkansen bullet train station are just one stop away. Shijo Street has a wide range of shops, from traditional craft outlets to boutiques carrying designer fashion.

Ascott said its latest property will cater to strong demand for quality accommodation in Kyoto, which is a popular tourist destination and a venue for international conventions.

With this project, Ascott’s portfolio in Japan will increase to over 3,800 apartment units in 53 properties across 10 cities including Tokyo, Kyoto, Osaka, Nagoya, Kobe and Hiroshima.

Source: Business Times, 6 Mar 2010

The US and Japan are expected to see the biggest rise in distressed property sales in the first quarter, as the fallout from the global property downturn intensifies, the results of a survey showed yesterday.

By contrast, respondents in Brazil, India, Hong Kong and Australia are more optimistic and expect fewer distressed property listings, the Royal Institution of Chartered Surveyors (RICS), which surveyed 430 of its members in 25 countries, said.

RICS, which last polled its members in the final quarter of 2009, defines distressed properties as those with a foreclosure order or are advertised for sale by their mortgagee, and which tend to fetch a lower price than their market value.

It said that the net balance of 85 per cent more respondents in the US polled during the fourth quarter expect distressed property sales to rise in the first three months of 2010, compared with about 68 per cent in Q3.

The turnaround was even more distinct in Japan, where the net balance of respondents predicting an increase in distressed sales this quarter jumped from 12 per cent in the Q3 2009 poll, to 80 per cent in the Q4 poll.

Rounding out the top five markets expected to be worst hit by distressed sales this quarter are Ireland, Scandinavia, and Spain, the survey showed.

It is the major property markets of the world, namely the US and Japan, where agents expect the strongest growth in distressed sales in the first quarter of 2010,’ Oliver Gilmartin, RICS senior economist, said.

RICS also asked its members whether the levels of interest from specialist funds that buy distressed properties was rising, finding that 21 out of 25 countries saw increased interest, with interest in Spain, Ireland, the UK, and the US rising at a faster pace.

‘Significantly, whilst the US is seeing ongoing rises in interest from specialist funds, Japan is not the recipient of the same level of investor appetite for distressed property assets,’ Mr Gilmartin said.

Source: Business Times, 2 Mar 2010

Mapletree Logistics Trust has signed a conditional sale and purchase agreement to buy a warehouse in Japan for about S$68 million (JPY4.36 billion).

The yield of the property at 7.26 per cent is higher than the implied property yield of the existing Japan portfolio of 4.5 per cent.

The acquisition will be accretive to MapletreeLog’s distribution per unit (DPU).

The proforma financial effect of the acquisition on the annualised DPU (based on actual 9 months financial results for 2009) is an additional 0.103 Singapore cents or 1.75 per cent.

Source: Business Times, 28 Dec 2009

People struggling to repay mortgages; more buyers as prices are falling

Auctions of foreclosed homes in Tokyo rose to a five-year high as more people struggle to repay their mortgages, Sanyu Appraisal Corp said.

The number of homes sold at auctions supervised by the Tokyo District Court increased 22 per cent to 2,795 in the six months ended Sept 30, from the preceding six months ended March 31, the Tokyo-based property appraiser said.

‘More people are submitting bids to buy foreclosed properties because the prices are falling,’ Hirohisa Hagino, managing director of Sanyu, said by telephone yesterday.

The number of bidders more than doubled to 18,171 in the same period. ‘This is the highest since we began compiling data in 2003,’ Mr Hagino said.

Of the 2,795 properties auctioned, 87.6 per cent were bought, an increase of 12 percentage points from the six months ended March 31.

‘Buyers are showing strong appetite for condominiums on expectations the market will recover,’ Mr Hagino said. He said 93 per cent of condominiums offered at auction were sold in the six months ended Sept 30.

Source: Business Times, 17 Dec 2009

Rents for first-class offices in Tokyo will likely bottom out in the first half of 2010 and foreign investors have already begun hunting investment opportunities in the city’s property market, a report said.

The average rent for Tokyo’s grade A offices fell 35 per cent by September from the recent peak in March 2008 and nearing levels seen in 2003 and 2004, property adviser Jones Lang LaSalle said.

Looking ahead, however, the city’s premier office rents are likely to bounce higher in the first half of 2010 after falling to within 10 to 20 per cent of the bottom seen in 2004, thanks to limited supply, the report said.

A recovery in the office market would also likely lift investor sentiment as well as banks’ willingness to lend, the report said.

‘Foreign investors had been sitting on the sidelines in 2009 because of a falling rents and higher yields. But investors, especially those managing foreign pension funds, have begun mulling over re-entry given signs of improvement in the market,’ LaSalle said.

‘We believe we will witness a return of those investors to the country’s property market in early 2010′ it said.

Source: Business Times, 17 Dec 2009

Luxury homes in Hokkaido and high-rise San Francisco apartments beckon to the well-heeled in Singapore

When it comes to overseas property launches, the choices used to be mostly beachfront developments or city projects.

But now, investors in Singapore may be spoilt for choice as more launches come to town, among them an unusual posh development in Japan.

The latter is one of two upmarket projects launched last Friday.

It is a 149-unit branded residential development called Capella Niseko Resort and Residences and is situated close to the popular ski destination at the Annupuri-Niseko Mountain in Hokkaido. The project also includes a 67-room hotel.

Aside from the Capella brand – the hotel and residences will be managed by Capella Hotels and Resorts – the freehold project boasts renowned Japanese architect Tadao Ando.

Clearly targeted at those who love snow and skiing, the project has 94 apartments, 36 houses and 19 villas, all of which are fully furnished and come with room service. The prices range from US$1 million (S$1.4 million) to US$5.5 million.

The project was developed by Hong Kong-based Annupuri Land. Couple Harry Pang and Mae Loh, who founded the company, have been skiing in the Annupuri-Niseko mountain region for years. They love the place so much that they decided to have a project there.

They then roped in friend Ernest Tsang, who is managing director of Annupuri Land, and other partners, including a few wealthy Asian dynasties such as the Shaw family in Hong Kong and the Khattar and Kwee families in Singapore.

The total investment cost of the project, including the land, is US$220 million. A branded residence typically commands a premium of 10 to 30 per cent, with the upmarket ones like Capella factoring in a premium on the higher end of the scale. A key selling point of the project, said Mr Pang, is the area’s natural attributes. ‘You can lie in the powder snow for an hour and won’t get wet.’

The Capella project was first launched in Hong Kong early last year, and has sold 20 units at a 10 per cent discount. Subsequent launches were derailed by the global crisis until now.

The other project launched in Singapore last Friday is Millennium Towers in San Francisco, by US developer Millennium Partners.

The 60-storey luxury development, completed in April this year, is the fourth-tallest structure on the San Francisco skyline.

Managing director Richard Baumert said there was a lot of interest from Asia in the past four to six weeks alone.

‘The timing is right for Asia, as the world economy improves and financial markets stabilise,’ he said.

The project was first launched in November 2007 and had ‘an amazing response up until mid-September 2008′, he said.

Prices start at US$600,000 for a 662 sq ft one-bedder to US$10 million for a penthouse, or from around US$800 psf to US$1,600 psf. So far, 30 per cent of the 419 units have been sold.

Late last month, Central London developer Native Land held a preview in Singapore of its prime development Neo Bankside. This is located near the Tate Modern Gallery on the South Bank of the River Thames.

And earlier, a luxurious freehold Bvlgari-branded residential villa project in Bali was launched here.

Jones Lang LaSalle’s head of residential, Ms Jacqueline Wong, said investors can look forward to more interesting developments next year.

These include another branded residence yooPhuket, in Phuket, which could be launched early next year.

Investors may not be used to investing overseas but this could be a good time, said Ms Wong, who is marketing the Capella project.

‘The world property market has not recovered completely, so the potential is still there,’ she said.

———————————————————————-
Good time to launch
‘The timing is right for Asia, as the world economy improves and financial markets stabilise.’ – Managing director of Millennium Partners Richard G. Baumert, on the launch of its 60-storey luxury development in San Francisco

Source: Sunday Times, 8 Nov 2009

(SINGAPORE) The luxury 149-unit Capella Niseko Resort and Residences in Hokkaido will be launched for sale here on Friday.

Set on 32 acres of greenery and close to popular ski destination Annupuri-Niseko Mountain, the freehold residences – which comprises 94 apartments, 36 houses and 19 villas – are expected to be completed in 2012. Construction is to start around April next year.

Capella Hotels and Resorts has come on board as the operator and renowned Japanese architect Tadao Ando will design the project.

The 67-room Capella Niseko resort will be a full-service hotel, including a Village Centre that offers fine dining, bars and a spa.

Property developer Annupuri Land said that about 20 residential units have been taken up so far – with the majority of buyers from Hong Kong – and it hopes that the rebounding economy will spur sales.

‘The timing is right. The Asian economies are taking off again,’ said Annupuri Land co-founder Harry Pang.

The entire project will cost some US$220 million, while the residences are in the range of US$1 million to US$5 million.

Mr Pang also reckoned that buyers can net an estimated 4-5 per cent yield annually from renting out their residences when they are not in use. ‘There’s a lot of potential for upside,’ he said.

Besides skiing, the Niseko region also offers other recreation such as golf, horseback riding, whitewater rafting and hiking. It is accessible by rail and road as well as by direct international flights. For instance, Singapore Airlines runs a direct flight to Sapporo, which is 120 km away.

‘It is a rare opportunity for potential buyers looking at investing overseas. Buyers will not only be able to appreciate the work of master architect Tadao Ando and enjoy the luxury provided by the Capella Group but also take in the fineness of the Annupuri-Niseko Mountain and its surroundings,’ said Jones Lang LaSalle (JLL) head of residential, Jacqueline Wong.

JLL is the sole marketing agent for the residences, and Peter Silling & Associates is in charge of the interior design for the project.

Source: Business Times, 5 Nov 2009

The number of new apartments put up for sale in the Tokyo area rose 26.2 per cent in September from a year earlier for the first rise in 25 months, a property market research firm said yesterday.

The data is a bright sign for Japan’s property market, which had been hit hard as Japan was stuck in its worst recession since World War Two.

New units put up for sale in the Tokyo area totalled 3,063 in September, the Real Estate Economic Institute said.

The contract ratio in the Tokyo metropolitan area rose to 73.9 per cent from 69.3 per cent in August, the institute said.

The ratio, the number of units sold as a percentage of units put on the market, is used to judge the market’s health and a ratio below 70 suggests a weak market where consumers are reluctant to buy.

Source: Business Times, 15 Oct 2009

Group of residents faces stiff resistance from officials and developers

(TOKYO) Growing up in prewar Tokyo, Makoto Kaneko recalls that the perfectly shaped, snow-capped cone of Mount Fuji was like a constant companion, visible on the horizon from the narrow streets of his hilly working-class neighbourhood.

The most majestic view was from a steep hillside affectionately named Fujimizaka, ‘the slope for seeing Mount Fuji’.

Today, Mr Kaneko’s cramped 80-year-old shop selling foods cooked in soy sauce is one of several old wooden stores and Buddhist temples that still stand here, making the Nippori neighbourhood a rare oasis of medieval charm in Tokyo’s concrete sprawl.

But the distant volcano, Japan’s tallest peak and pre-eminent national symbol, has been increasingly blocked by skyscrapers and smog.

Mr Kaneko said he and other residents did not mind because they still had the vista from Fujimizaka, which has become a minor tourist attraction.

Then, one day a decade ago, they learned of plans for a 14-story apartment building 1.6 kilometres away that would partly obstruct that view.

‘My mind went blank with disbelief,’ said Mr Kaneko, 83.

‘That is when we realised what we were losing.’ With the help of a university professor, the neighbourhood’s mostly greying residents formed the Society to Protect Nippori’s Fujimizaka, which Mr Kaneko leads.

The group has approached developers, landowners and local governments, but their efforts have collided with a preservation problem: Protecting a building or a park may be one thing, but how do you protect a view?

Saving the view from Nippori’s Fujimizaka would require capping building heights within an elongated fan-shaped corridor 4.8 km long and up to 305-metres wide across densely populated neighbourhoods.

So far, the society has met stiff resistance from city officials and developers in Tokyo, whose properties rose rapidly from the postwar ashes thanks in part to unrestrained construction.

‘Tokyo’s approach has been to build first, worry about beauty and preservation later,’ said Kazuteru Chiba, the professor of urban planning at Tokyo’s Waseda University who helped form the Fujimizaka society.

‘This is true even when it involves a national emblem like Mount Fuji.’

Still, the neighbourhood’s cause has slowly gained support in Tokyo, as part of a small but growing clamour to preserve the city’s remaining historical places.

The neighbourhood has benefited from Utagawa Hiroshige, one of Japan’s most celebrated 19th-Century artists, who depicted the view of Mount Fuji from Nippori in a woodblock print.

Local media coverage has also focused on Nippori’s distinction as the last of 16 slopes in central Tokyo named Fujimizaka from which Mount Fuji is still visible.

The naming of hillsides dates to medieval times, as a form of street address before Tokyo’s more recent neighbourhood-based numbering system.

Fujimizaka was the most frequently used name, reflecting the mountain’s sacred place in Japan’s indigenous Shinto religion, according to Noriko Ide, a leader of the Slope Society of Japan, a private group that chronicles the history of hillside names.

‘It is a miracle that one of these slopes has survived,’ Ms Ide said, ’so it is a precious cultural asset.’

The slope also figures prominently in Nippori’s local lore. In the closing days of World War II, a local woman claimed that while standing on the slope, she could see a flash and a funny-shaped cloud just to the right of Mount Fuji – at the exact moment that the first atomic bomb was dropped on Hiroshima, according to Nobuyuki Nozawa, a local veterinarian.

‘Mount Fuji is like an old friend guarding us,’ he said.

When the Fujimizaka society and local government officials approached the developer of the 14-storey apartment building, they could only ask for his cooperation.

The developer, the real estate arm of what is now the steel maker JFE Holdings, demanded US$12 million in compensation for eliminating the top five floors from the US$16 million building.

With such a sum beyond the society’s means, the developer went ahead with finishing the building in 2000.

It now blocks the left third of Mount Fuji as seen from Nippori’s Fujimizaka.

Prof Chiba said the failure to stop the 14-story building so discouraged residents that the Fujimizaka society almost disbanded.

‘Then we realised there is still two-thirds of the view left. So we decided, let’s protect that,’ he recalled.

The society has tried to increase public awareness by contacting landowners where tall buildings could be built that would block the remaining view.

They also began organising an event called Diamond Fuji, during the two times a year when the sun sets exactly on the top of the volcano’s symmetrical cone.

The last Diamond Fuji, in January, drew 300 people, Mr Kaneko said.

Still, like most residents, Mr Kaneko is far from optimistic. ‘I can’t imagine Nippori without Mount Fuji,’ he said.

‘But it is probably just a matter of time before another building appears that will block what’s left.’ – NYT

Source: Business Times, 13 Oct 2009

Expected buyer is a Japanese insurer, says report

(HONG KONG) American International Group Inc is close to agreeing to sell its Japanese headquarters for about US$1 billion, which would mark one of its largest sales of assets to pay off government debt, The Wall Street Journal reported.

At least two suitors competed for the 15-storey building next to the Imperial Palace in Tokyo, the report said, quoting unidentified people familiar with the matter.

The expected buyer is a Japanese insurance company which wasn’t identified in the report.
AIG put the property up for sale in February to help pay off US$45 billion it owes the US government as part of a US$173.3 billion rescue package, the newspaper said.

The exact timing of an agreement was unclear because the Japanese markets will be shut until tomorrow for the Golden Week holidays, it added.

AIG recently shelved plans to sell its core insurance operations, including those in Asia, because of poor market conditions, the report said.

Yet it is continuing its attempts to sell real estate and non-core businesses, such as its aircraft-leasing unit, it added.

Last month, Zurich Financial Services AG agreed to pay US$1.9 billion for AIG’s personal car insurance arm, the largest AIG divestiture so far since its September government bailout, the report said.

AIG may also be close to selling International Lease Finance Corp, its aircraft leasing unit, the report quoted unidentified people as saying.

Several private equity- led groups have indicated interest in the business, whose sale could fetch US$4.5 billion to US$6 billion, it cited people close to the matter as saying.

The US government, which has offered to help finance the sale, is expected to clarify requirements for potential buyers in the coming weeks, according to the report.

Former AIG chief executive officer Maurice ‘Hank’ Greenberg, who led the insurer for nearly 40 years, had warned that the sale of the Tokyo office building would further demoralise the company’s Japanese employees, the The Wall Street Journal said.

AIG arrived in Japan in the wake of World War II upon the invitation of General Douglas MacArthur.
The sale of the property would serve as a reminder of the insurer’s waning influence in Asia, the report said.

Tokyo’s commercial real estate market has held up better than international hubs in recent months, the report added.

Bonnie Wu, an AIG spokeswoman in Hong Kong, referred inquiries to the Tokyo office, where nobody answered calls because of the holiday. – Bloomberg

Source: Busines Times, 5 May 2009