As many as 31 municipalities in Tokyo and neighboring prefectures are suffering from the fiscal burden of long-unsold plots of land owned by public-sector developers to which they have provided loan guarantees, according to the latest survey by Kyodo News.
Land-development public corporations have suffered badly from the collapse in land prices after the asset-inflated bubble economy of the late 1980s burst. The Kyodo survey examined the fiscal 1999 books of 176 such corporations in Tokyo, Kanagawa, Saitama and Chiba prefectures.
These corporations borrowed money from banks when they purchased the land for development during the boom years, but were left with only the debt burden when the value of the land went down.