Singapore investors have a yen for Japan real estate amid tourism boom

Country's excellent value for money and low barriers to entry cited as key factors

- Walter Sim

TOKYO From ski resorts and beachside retreats to city hotels and vacant rural homes, Singapore investors have a yen for hospitality purchases in Japan to cash in on its tourism boom.

The country has red-hot potential and remains excellent value for money, while offering low barriers to entry for foreigners, they told The Sunday Times.

This is despite the Bank of Japan's first monetary policy rate hike in 17 years on March 19, followed by data a week later showing land prices recording their largest surge in over 30 years in 2023.

"Japan probably will get more expensive, and it should because it's still way too cheap," Patience Capital Group (PCG) founder Ken Chan, 46, told ST. The fund owns 350ha of land, mainly in Myoko in Niigata, including the country's second-longest ski run at 8.5km.

"The question is, will foreigners not come because it's more expensive? I think the answer is no. Even if prices go up 20 (per cent) to 30 per cent, it is still very cheap," added Mr Chan, who used to head Singapore sovereign wealth fund GIC in Japan.

Such bullish sentiment drove Singapore to become Japan's top real estate investor in 2023.

Multimillion-dollar deals were sealed, with newcomers such as IMC Pan Asia Alliance Group and Anglo Fortune Capital Group snapping up their first Japan purchases, while long-time investors like GIC and SC Capital Partners expanded their Japan portfolio.

IMC is an industrial and shipping conglomerate that also has businesses in real estate - it co-developed Singapore's Suntec City complex and more recently ventured into hospitality. In 2017, it opened its first "well-being resort", Sangha Retreat by Octave, in Suzhou, China.

In May 2023, it bought a 30,000 sq m plot of land in Kawana in Shizuoka's Izu Peninsula offering sweeping bayside views.