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| Prime Minister Yoshihiko Noda |
Boston, MA (SBWIRE) –London-based Business Monitor
International’s new Japan Real Estate report examines the commercial office,
retail, industrial and construction segments throughout the country in the
context of reconstruction efforts post-Tohoku coming to fruition at a more
moderated rate than previously anticipated.
With a focus on the principal cities of Tokyo, Osaka and
Yokohama, the report covers the rental market performance in terms of
rates and yields over the past 18 months and examines how best to maximize
returns in the commercial real estate market, while minimizing investment risk
and exploring the impact of the completion of new supply on a market which was
surprisingly resilient in the wake of the earthquake and tsunami in 2011.
Our most recent
round of in-country interviews (conducted in July 2012) showed that rents
continue to struggle with stability across all sub-sectors.
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| Tokyo Skyline |
Key Points:
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The Cabinet office of Japan revised down its estimate
of growth in Q212 to an annualized rate of 0.45% quarter-on-quarter, in line
with our expectations for the Japanese economy to cool as volatility in the
external environment has an adverse impact on domestic economic activity
levels.
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The September Tankan survey and other economic
indicators suggest that businesses are likely to see conditions deteriorate,
which bodes poorly for private investment growth.
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We believe that
growth is likely to slow further in 2013, to come in at a subdued 1.2%, and
highlight the growing risks of recession.
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Even with the election of new party chiefs in both the
ruling Democratic Party of Japan and opposition Liberal Democratic Party (LDP),
we believe that the political impasse will remain, as the opposition parties
continue to push Prime Minister Yoshihiko Noda to call for an early
dissolution of the House of Representatives.
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| Osaka Skyline |
Our core view is for the LDP to win the largest number
of the seats in the lower house, but fail to secure a majority and thus need to
seek more partners to form a ruling coalition.
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As such, we
expect the current policy gridlock to remain, which could present downside
risks to our forecast.
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We believe that Japanese real GDP will decline to 1.2%
in 2013, from 1.5% in 2012, as the country struggles to find sources of growth
as it faces weakening demand both at home and abroad.
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| Yokohama night skyline |
Moreover, we expect the political impasse to impair the
government's ability to stimulate the economy and expect the public sector to
shrink its contribution to growth as the current rate of debt growth is
unlikely to be sustained.
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In addition, we
see growing downside risks to our downbeat growth forecasts as the
deterioration in economic data from Japan's trading partners suggests that
another global recession could be at hand.
The complete report is available from Fast
Market Research of Williamstown, MA. Fast Market Research is an online aggregator and distributor of
market research and business information. The company says it represents the world's top research publishers
and analysts.
For more information about related research reports, please
visit our website at http://www.fastmr.com
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