Thursday, October 27, 2005

The Fund Crowd Gets Some R&R

This from the Nikkei : Real estate funds are finding the competition too hot in Tokyo, and are shifting their focus to hotels, golf courses and other leisure facilities. These companies now estimate returns of at least 8% for some funds investing in leisure facilities, compared with 5-6% for funds targeting office buildings in central Tokyo. It helps that growth in the number of wealthy seniors is expected to boost demand. DaVinci Advisors’ Osamu Kaneko opines that "The impending large-scale retirements of baby boomers will boost the population of well-to-do seniors”. He says many facilities have closed in recent years, leading to a shortage. Some recent developments:

  • DaVinci Advisors : 20 billion yen budget for ski resorts and hotels. Intends to list a hotel REIT in 2007. Recent purchase: Madarao Heights Development Co., owner of the Madarao Kogen Hotel and ski resort in Nagano.

  • Reicof Co. : new fund of 10-15 billion yen for hotels and golf courses. Recent purchases: the Azveil, a slick repositioning of a hotel in Atami, Shizuoka, and the Rota Resort and Country Club on Rota Island in the Marianas.

  • Pacific Management Corp. plans to invest 30 billion yen to buy five to 10 golf courses.

  • Simplex Investment Advisors in September bought the beautiful La Vista Golf Resort (pictured) in Chiba, across the bay from Tokyo.

  • Meanwhile in Tokyo, the luxury New Otani, Okura, and Imperial hotels – called the 'Gosan-ke', or Three Houses - are frantically upgrading to face a host of newer foreign players. Individual investors are also putting their money into leisure real estate, as exemplified by the recent rush to buy second homes and holiday properties in the tony resort town of Karuizawa, Nagano. I’ll be writing more about these topics in a future posts.

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    ダヴィンチ レイコフ シンプレクス パシフィックマネジメント レジャー施設 投資


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