Tokyo Tatemono Co., the third-best performing Japanese builder this year, is considering investments in Southeast Asia to counter slowing demand at home because of the aging population.
Tokyo Tatemono, which has investments in China, must look at other markets just like rival developers will, Hajime Sakuma, the company’s incoming president, said Monday.
“We must start thinking about this,” Sakuma said. “Places such as Southeast Asia would be one of the potential markets. A country’s population, standard of living, and local preference are all among things that need to be considered.”
Like Mitsubishi Estate Co. and Mitsui Fudosan Co., Japan’s two largest developers, which have invested in China and Singapore, 115-year-old Tokyo Tatemono is looking to expand as the population in Japan declines. Forty percent of the population will be at least 65 years old by 2060, according to a report by the National Institute of Population and Social Security Research.
Sakuma said overseas markets are more profitable, without being more specific. The firm is forecasting its biggest annual loss for the year that ended Dec. 31.
Tokyo Tatemono started its first project in China in 2005 through a joint venture with a unit of China Vanke Co., the country’s biggest listed real-estate company, to develop 230 apartments in Shanghai. More than half of Tokyo Tatemono’s sales in Japan are from residential sales and about 30 percent from office leasing.
Housing starts up again
Housing starts increased 2.6 percent in 2011 to 834,117 units, rising for the second straight year.
The Land, Infrastructure, Transport and Tourism Ministry said Tuesday the increase stemmed primarily from a policy of helping to lower mortgage rates for homes that clear certain conditions, such as their ability to withstand earthquakes.