Institutional investors hunt for Japanese property bargains as coronavirus tips the country into economic recession
- Sentiment in Japan’s real estate sector remains positive, with investors hoping bargains will emerge as hoteliers and other owners sell off cheap to raise much-needed cash
- There is, however, a mismatch between the expectations of bargain hunters and the relatively small number of forced sellers actually in the market, says CBRE
The Covid-19 pandemic has savaged the already fragile Japanese economy, pushing it to the brink of technical recession.
However, sentiment in the country’s real estate sector remains positive, with institutional investors hoping bargains will emerge as hoteliers and other owners sell off cheap to raise much-needed cash.
Hospitality operators would now have been looking forward to one of their most lucrative holiday seasons ever, if the global health crisis had not got in the way of the Tokyo 2020 Olympic games.
“It is very unfortunate that Tokyo is facing a delay in the Olympics, which normally would be a big boost to the economy. The hotel and tourism sectors are being hit,” said Nick Loup, chief executive of Chelsfield Asia, a property management firm focused on acquiring underperforming assets and transforming them into profitable enterprises.
“Some small [hotel and tourism] operators may not sustain their ownership during this difficult period.”