TOKYO -- Japan's Finance Ministry will switch from selling unused government-owned land to leasing it out, helping to put lots to productive use and bring in rental income without loss of ownership.
The government will permit these parcels to be leased via fixed-term agreements for educational and nursing-care facilities -- of which the country has a chronic shortage -- as well as commercial use, hoping to encourage a competitive bidding process.
The new policy, to be drawn up in June, will apply to plots measuring at least 1,000 sq. meters in densely populated areas in and around Tokyo, and at least 2,000 sq. meters in certain other cities. Smaller lots expected to see redevelopment or population influxes will also be considered as candidates.
The government holds a number of land parcels that it is reluctant to sell because they could not easily be repurchased. Leases let it retain the option of using the land itself later, for such applications as disaster prevention.
By selling plots seen as unnecessary for it to own, the Japanese government has slashed the appraised value of its idle land by four-fifths over the past two decades to 362.6 billion yen ($3.29 billion). But it brings in only about 30 billion yen a year from leasing out state-owned assets.