OSAKA -- Sekisui House is among the Japanese homebuilders going on the offensive overseas with major projects in Australia and greater Asia.
The Osaka-based company plans to construct 6,200 units, including luxury condominiums, in Australia by fiscal 2020 for some 240 billion yen ($1.98 billion). It will partner with builders there to develop a combined 270,000 sq. meters of land in Sydney and Brisbane.
About 5,000 units in 40 buildings will be constructed around 20km from central Sydney. A 90-sq.-meter condo will carry a median price of roughly 80 million yen. In Brisbane, 1,200 condos are planned.
Sekisui House's advance investment, an indicator of future development project trends, underscores a sharper focus on foreign markets. It was higher at home than abroad until fiscal 2013. But now, advance investment overseas has jumped 60% to come out on top. Advance investment abroad is seen at 600 billion yen at the end of fiscal 2015, compared with 400 billion yen in Japan.
Daiwa House Industry will likely sink at least 100 billion yen into overseas investment for the three years starting fiscal 2016. This doubles the 50 billion yen, or 6% of the overall total, used for Chinese condos and other projects abroad over the previous three-year period. In the U.S., the company is eyeing 150 billion yen in investment, including years beyond fiscal 2018. It began construction of a high-rise apartment building in Chicago this summer.
Mitsubishi Jisho Residence plans to start building its seventh condo project in Bangkok next year. The 773-unit project is slated for completion in 2018, with the company continuing to construct an annual three to five buildings after that.
Sumitomo Forestry will sell more detached homes in Australia and the U.S. by collaborating with local builders acquired since 2009.
Amid a shrinking domestic market, many Japanese homebuilders are eager to spread their wings elsewhere. The nation's housing starts came to 880,000 units in fiscal 2014, roughly half of a peak hit in the 1970s. The Nomura Research Institute sees the figure falling to 530,000 in fiscal 2030.
Japanese homebuilders possess know-how in constructing durable, earthquake-resistant residences and keeping to schedule. They aim to capitalize on such strengths with large-scale development projects in Australia and Asian emerging markets, whose populations are growing.
These moves mark a second boom in overseas expansion by Japanese homebuilders. The first came in the 1970s and '80s, when they built many resort facilities in the U.S. and Australia. But the bursting of the domestic economic bubble forced a retreat.