Japan's condo developers spot opportunities in Asia-Pacific urbanization
Projects start up in Melbourne, Jakarta as shift to cities fuels demand for housing
KOICHI KATO and JUNTARO ARAI, Nikkei staff writers
TOKYO/FUKUOKA -- As people around the world increasingly adopt urban lifestyles, Japanese companies are seeing new opportunities to expand their overseas operations, especially in building commercial and residential complexes.
Japanese companies have expertise in building high-rise compact residences. They are also good at building complexes with shops and restaurants on lower floors and residences on upper floors.
For example, Mitsubishi Estate recently announced that it will develop a 44-story residential tower block in Melbourne, Australia with 719 units in 2020.
The Japanese real estate company plans to set up a joint venture with Lendlease, a local property and construction company. Mitsubishi's condominium will be built as part of Lendlease's large-scale development project, dubbed Melbourne Quarter, near Southern Cross Station in central Melbourne. The construction of the condominium will cost an estimated 34 billion yen ($306 million). The cost will be split between Mitsubishi and Lendlease.
The condominium will have a floor space of about 58,730 sq. meters. Each unit will occupy between 50 and 119 sq. meters. Construction is scheduled to start in late November.
Melbourne Quarter is a redevelopment project that includes three new office buildings and three residential buildings that will have about 1,690 units. The project is scheduled to be completed in 2026 or later.
Development plans for the remaining two residential buildings will be decided later.
Melbourne is a city of about 4.4 million, and the population has been growing by about 100,000 a year. In Australia, people are increasingly moving into cities, and Mitsubishi Estate thinks the country is a promising market for property development.
Last year, Mitsubishi Estate, as part of a joint venture with Lendlease and a Chinese property company, announced a redevelopment project in Sydney that includes the construction of a 248-meter high-rise building. The company plans to launch more development projects in Sydney, Melbourne, Brisbane and other Australian cities to build housing, buildings and warehouses.
Nishi-Nippon Railroad has said it plans to build two condominiums in suburban Jakarta.
The Japanese railway company plans to build two condominiums with over 1,500 units in Bekasi, east of Jakarta. The project is expected to cost about 530 billion rupiah ($39.2 million). The company hopes to complete the project by June 2022. Nishi-Nippon Railroad and Damai Putra group, a major local property company, will set up a joint venture, with Nishi-Nippon taking 45% and Damai Putra 55%.
Damai Putra has been developing 2,200 hectares of land in the city. The joint venture will build the condominiums on the plot. Most of the units will be studios and sold for an average 300 million rupiah or so. The companies plan to attract people who will work at a nearby university, which is currently being built. Condominiums are also popular in Indonesia as an investment among the wealthy and the middle class, the companies said. Nishi-Nippon Railroad hopes to raise sales from its overseas housing operations to 11 billion yen a year over the next decade.