Tokyo is expecting another long list of planned developments to launch next year amid increasing demands for properties toward the 2020 Tokyo Olympic Games. Large-scaled urban developments in designated National Strategic Special Zone will soon start in a full swing, while many hotel developments are scheduled to break ground with an aim to complete in time for the big event. Construction of four projects in the Special Zone will begin in 2016; Otemachi-1 District 2 in Chiyoda-ku, Toranomon-4 in Minato-ku, Takeshiba in Minato-ku, Atagoyama I in Mianto-ku. The developers are required to build pro-business environment especially for international businesses. In line with the administration’s policy to lure foreign tourists, Otemachi-1 and Toranomon-4 projects will introduce hotels and serviced apartments, while the 220-meter tall Atagoyama tower will have various residence such as rent, sell and serviced condo.

Reconstruction of Hotel Okura in Mianto-ku, one of the highest-ranked hotels in Tokyo has been undertaken by Taisei Corp., with completion aimed in time for the Olympics to attract growing demands. KKR Toranomon Hospital, or “the Olympic Hospital” which is designated to treat the Olympic athletes is under demolition followed by reconstruction.

Despite the booming property market, the continuing high level of construction cost has remained a factor of concerns. Supply of office floors is estimated at 600,000m2 in 2017, showing a significant drop to approximately 50% of the survey conducted a year earlier, according to the recent report of Mori Building and Mori Trust. The supply in 2018-2019, on the contrary, is expected to grow. The survey shows developers tend to delay project completion in fear of the building cost hike. (2015/12/10)