A growing number of investors from Singapore and other parts of Asia are looking to enter the Tokyo property market which has become more attractive in recent years, revealed CBRE.
The city’s condominium segment hit bottom in 2013 while the yen has depreciated rapidly, making it a relatively affordable investment destination compared to other markets.
Furthermore, values of condominiums in Tokyo shot up 18 percent last year.
“Many foreigners who have bought apartments in Tokyo are optimistic about Tokyo’s residential market due to a number of factors, namely the upcoming Olympics in 2020; President Shinzo Abe’s aggressive economic stimulus package; and increasing ease of obtaining financing in their home country for Japanese properties,” CBRE shared.
The agency is gearing up to showcase an 883-unit high-rise condo in Minato Ward Tokyo to Singaporean investors this weekend.
Developed by a consortium led by Mitsui Fudosan Residential, Global Front Tower offers many facilities including a residents’ lounge overlooking Tokyo Bay (pictured), a gymnasium, and convenience store. A large space has also been set aside for greenery, including 62,000 sq ft of landscaped garden.
The development is within walking distance to a major train station, offering direct access to shopping and entertainment hotspots like Ginza and Shibuya.
According to CBRE, rental demand for new apartments in Minato Ward is strong due to its central location and proximity to offices and international schools.
It added that vacancy rates in Minato Ward are about 6.6 percent while rents increased by 11 percent in Q3 2014.
Sarah Nicholson, Director of International Projects Marketing at CBRE, pointed out that rental yields in Tokyo are appealing. Specifically, Global Front is offering a gross yield in the range of 4.5 to 5.1 percent.
In 2015, CBRE expects Tokyo condo prices to climb by around 10 to 15 percent as properties there remain popular among overseas investors.
CBRE and Mitsui Fudosan Residential will be hosting an exhibition in Singapore on Saturday 31st January and Sunday 1st February 2015, 11am to 7pm, at The Regent Singapore.
Romesh Navaratnarajah, Singapore Editor at PropertyGuru, wrote this story. To contact him about this or other stories email romesh@propertyguru.com.sg
