Huge rent hike set to end sweet deal for Sensoji Temple shopkeepers

One of Japan’s oldest and most visited shopping streets in the heart of Tokyo’s touristy Asakusa district is bracing for a massive rent hike.

The 89 stores lining the narrow 250-meter-long Nakamise dori shopping strip leading up to Sensoji Temple sell anything from senbei (rice crackers) to affordable kimono and mock samurai swords. It is one of the nation’s hottest tourist draws and is especially popular with overseas travelers looking to stock up on Japanesque souvenirs before heading home.

Until now, tenants operated under a unique arrangement: While the land belonged to Sensoji, the shops were owned by the Tokyo Metropolitan Government, to whom the shopkeepers paid rent.

But Sensoji bought back ownership of the shops from the capital in July for ¥20 million and is negotiating new rents based on market rates, which are around 17 times higher.

To be fair, the monthly rent tenants have been paying — ¥15,000 per 10 sq. meters — is disproportionately cheap, considering the area’s land value and business potential.

Sensoji, Tokyo’s oldest temple, was established in the seventh century and attracts around 30 million visitors annually who typically enter through the iconic Kaminarimon gate and walk along bustling Nakamise dori before paying their respects.

Ichiro Morita, a spokesman for the union representing the Nakamise shop owners, said it was consulted by Sensoji in September regarding the fee adjustments.

“Sensoji told us that the going rate in the area is around ¥250,000 per 10 sq. meters, which is around 16 to 17 times the current rate,” he said. “We told them we were troubled by the idea and wanted to negotiate.”

A Tokyo government official said the city collects around ¥25 million annually from the shops, which comes down to an average of around ¥23,000 per month per tenant.

A Sensoji representative said it merely informed the tenants of what is considered the going rate for rental properties in the vicinity, and hopes to reach an amicable deal by January, when it plans to raise rents. He said higher rents are also necessary in light of the maintenance fees expected for the aging shops.

The history of the tenants’ property ownership goes back to the 19th century.

In 1871, the Meiji government confiscated land owned by temples and shrines as part of a major restructuring of the nation’s land taxation system, and Sensoji was no exception. In 1899, Sensoji applied for the return of its property, which was granted in 1911.

Nakamise dori, however, continued to be managed by the Tokyo government, which constructed Western-style, red brick shops on the property, reflecting the trend of the era.

The area, however, was devastated by the 1923 Great Kanto Earthquake. The capital arranged to rebuild the shops in 1925 with reinforced concrete, but disaster hit again during World War II in 1945, when U.S. planes firebombed the capital in one of the most destructive air raids in history.

This time, though, the city was unable to finance the extensive repairs and rebuilding that were needed. Instead, shop owners gathered and funded the reconstruction work themselves.

In 1951, Nakamise dori was officially returned to Sensoji. But the fate of the shopkeepers was put in limbo. Until a decision on what to do was made, the city and temple agreed to maintain the status quo.

That was the situation until 2011, when the city consulted Sensoji about paying fixed assets taxes on the basis that Nakamise dori was acting as a profitable business. This triggered a review of the previous agreement, prompting Sensoji to buy back the shops from the metropolitan government. Three-way negotiations involving the city, temple and shop owners began in 2013, leading to the recent developments.

The three parties, however, agreed to preserve the distinctly Japanese old-school aesthetics of the shopping street, and Sensoji said it isn’t its intent to lure big businesses to the strip by calling for higher rents that could be unbearable for some tenants.

News of the planned rent hike drew a mixed response on Twitter, with many surprised at how little the shopkeepers had been paying.

“¥20,000 to ¥30,000 for that area is an exceptional deal,” tweeted user @sepponbakari.

“Some say those who can’t pay should leave and be replaced, but as a history buff I’m not too sure about walking through a shopping street lined with trendy cafes on my way to visit a temple,” tweeted @kazenone86.