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Why one of Japan’s biggest real estate projects is tapping Toyota

Written by Nikkei Asia Published on   3 mins read

Mitsui Fudosan is looking to spread the risk for the USD 5.8 billion Tsukiji market redevelopment.

When Japanese developer Mitsui Fudosan laid out a JPY 900 billion (USD 5.8 billion) redevelopment plan in early May for the former site of Tokyo’s famed Tsukiji fish market, one name stood out on the list of partner companies: Toyota.

The automaker’s real estate affiliate, Toyota Fudosan, will join the 11-member consortium led by Mitsui Fudosan for one of the biggest projects of its kind in Japan.

The consortium, which also includes media group Yomiuri Shimbun Holdings—an operator of the Tokyo Dome stadium—will be responsible for the development and management of the Tokyo waterfront property. Toyota Motor has signed on as a cooperating partner.

The redevelopment of the 19-hectare site—slated to feature a 50,000-seat stadium along with an international conference center and office, residential and hotel space—is a dream come true for Mitsui Fudosan, the country’s biggest real estate company.

“This is an extremely important plan that will have an impact on Japan’s international competitiveness,” president Takashi Ueda told reporters on May 1.

For Toyota Fudosan, joining the effort fits with a goal of venturing beyond its home turf of Nagoya, near the heart of Japan’s auto industry.

The affiliate manages properties around Nagoya Station, including the Midland Square skyscraper. Formerly known as Towa Real Estate, the company changed its name in 2022 and now emphasizes its status as a Toyota group member.

“As a member of the Toyota group, we want to contribute to the [Tsukiji] project while playing a role in linking together urban development with mobility,” Toyota Fudosan president Tomohide Yamamura said.

Mitsui Fudosan is intertwined with company’s expansion.

Yamamura was involved in Mitsui Fudosan projects such as the Tokyo Midtown mixed-use development, which offers hotel, office and event spaces. He was brought in as Toyota Fudosan’s first president from outside the group as part of an effort to turn the company—which had served mainly as the keeper of group assets including stakes in parts supplier Denso and forklift maker Toyota Industries—into a full-fledged developer.

The two real estate companies have deepened their relationship, jointly taking ownership of Toyota Motor’s Tokyo head office last year.

For Mitsui Fudosan, having the Toyota group on board is no small help. When Mitsui Fudosan launched the Tokyo Midtown project, the company partnered with the likes of Japan’s National Mutual Insurance Federation of Agricultural Cooperatives, also known as Zenkyoren, and Meiji Yasuda Life Insurance.

“Mitsui Fudosan has excelled at an approach that involves taking on redevelopment projects after it has secured outside funding,” said an analyst at a Japanese brokerage.

Yamamura told reporters on May 1 that Toyota Fudosan is ready to make an investment that is “appropriate” for its role as a member of the consortium.

Mitsui Fudosan has other big ongoing redevelopments in Tokyo’s Nihonbashi and Uchisaiwaicho districts. Collaborating with a deep-pocketed Toyota group member will go a long way toward spreading the risk for the new project.

The Tsukiji market, originally built on reclaimed land, closed in 2018 and was replaced by a modern, enclosed site in Tokyo’s Toyosu neighborhood. The old site has been mostly vacant except for a stint as a parking lot during the delayed 2020 Summer Olympics.

Redevelopment plans at Tsukiji include a new subway station, expressway exit and dock, which will improve its transportation access. There are high hopes for the role Toyota’s mobility technology could play in areas like self-driving cars and flying taxis.

The Toyota group already is involved in a few redevelopment projects near Tsukiji, including at the Palette Town commercial complex in Tokyo’s Odaiba waterfront area.

“We want to consider possibilities” for collaboration between these facilities, Yamamura said. They could serve as showcases for Toyota technology to international visitors.

This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.


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