In the previous episode, we looked at areas with a large number of IT companies and the economic situation of its residents, based on the assumption that it is an industry that is less susceptible to the coronavirus outbreak. Firstly, what kind of trends can you see when you look at foreign companies? In this episode, we will take a closer look at the actual situation in Minato Ward, which is known as the home to many foreign companies and high-income foreigners that have become established in Tokyo.
More than 3,000 foreign companies have expanded into Japan, and Tokyo is actually the second highest ranked city in the world in terms of the number of Fortune Global 500 headquarters. Minato Ward is home to the largest number of foreign companies in Tokyo, with 815 foreign companies (both of these data points are as of 2017). In addition, there are 154 embassies in Japan, and more than half of these (82) are located in Minato Ward. Minato Ward has been mentioned several times in these episodes and it is also a regular in the top rent rankings. When we looked into the reason that Minato Ward has a
unique way of attracting people and companies), we had to go back to the Edo period.
*Source: Prepared by International Interface based on the website of the Ministry of Foreign Affairs of Japan as of April 15, 2020
As many of you may know, the Edo period is the name of a period in Japan when the Tokugawa family reigned that lasted from 1603 to 1868. It is said that there were many daimyo residences in the Minato Ward area at that time. Although Japan was closed for more than 200 years during the Edo period, the era shifted from Edo to Meiji after Japan opened up, and the Meiji government seems to have provided the ruins of these daimyo residences as a base for the countries with which it established diplomatic relations. During a time when the only means of transportation to and from Japan was by sea, Minato Ward was conveniently located along the route to the Port of Yokohama, which was essential for connecting the country with Tokyo. On top of that, the area had easy access to Japanese government agencies, and this led to more countries having embassies in Minato Ward. This made it easier for diplomats to interact with each other and to gather information, which in turn led to a greater concentration of embassies. That is how we got to the present. Of course, while the development of Roppongi Hills, which was completed in 2003 and is home to many foreign companies, has had a lot to do with it, the reasons why Minato Ward has been chosen can cannot be explained by looking only at the last few decades.
As one piece of trivia, one of the focus points for districts with embassies is the development of real estate through collaboration between the ministry of foreign affairs of a foreign country and a general company in some rare cases. For example, a 60-year fixed-term leasehold condominium on the former site of the French Embassy in Minami-Azabu was developed and sold by a general Japanese developer, the French Ministry of Foreign Affairs, and other business owners. In spite of the fact that properties with fixed-term leasehold rights are often under-represented in a wide range of price ranges from 60 million yen to 400 million yen, the legend that a condominium sold out within six months is also famous in the new condominium industry.
With history, diplomacy, business, and commerce all intersecting, investing in real estate in the ever-changing neighborhood of Minato Ward is sure to be very interesting depending on the timing and your judgment.
- Invest Tokyo
-“Minato Internationalization Master Plan - Promoting community participation and cooperation for foreign residents in a multicultural society - Revised version FY2018-FY2020”
- Minato city official homepage – See Minato city 6 【82】statistics
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