Brookfield to Invest $10 Billion in Japanese Properties

Brookfield Asset Management is ramping up its investments in the Japanese market.

The Toronto-based firm is planning to invest more than $10 billion in Japan over the next five years, taking advantage of relatively low real estate prices across the Pacific, Nikkei reported.

Brookfield first broke into the Japanese market in 2015 when it opened an office in Tokyo. Since then, the company has been investing in the country “slowly and modestly,” according to CEO Bruce Flatt.

“We are now set up to be able to actionably deploy amounts of capital like we deploy in our major markets of the world,” the executive said in a recent interview, per Nikkei.

Last year, the company invested in a stake of Hotel Gajoen Tokyo as well as a plot of land for logistics development in a $1.6 billion deal, Hospitality Investor reported.

With more than $1 trillion in assets, Brookfield specializes in buildings like power plants and data centers. Moving forward, it intends to build up new areas of investment in Japan like data centers and battery storage facilities.

The move comes after Brookfield announced last year it was considering “a couple of large-scale deals” in Asia, according to Alex Yang, managing partner at the firm and head of private equity for Greater China and Southeast Asia. The industrial and business services sector in particular are attractive for outside investors like Brookfield.

“There’s a lot of founder-led business transition and succession, which will require firms like us to bring the company to the next level,” Yang said, per Bloomberg.

Brookfield isn’t the only major North American firm to pick up Japanese investments in the past year.

Last December, Blackstone acquired Tokyo Garden Terrace Kioicho, a mixed-use urban complex in the Chiyoda neighborhood, for $2.6 billion. It comes complete with two office towers, retail space, 135 apartments and a 250-room hotel with conference and wedding facilities.

That deal followed a series of investments in the Japanese lodging market, bringing the company’s total commitment to hotels in Japan up to $1.3 billion, making it one of the largest foreign investors in the Japanese hospitality market.

Blackstone previously signed a two-hotel deal with seller Kanehide Holdings for $130 million. It included the 97-room Ritz-Carlton hotel in Okinawa, decked out with an 18-hole championship golf course overlooking the ocean. Another Okinawa hotel, the 162-room Kise Beach Palace, was the other half of the deal.

Blackstone then moved on to the Nest Hotel in Osaka, a 302-room budget hotel sold by Ichigo Hotel real estate investment trust, reportedly for around $50 million, according to Top Hotel Projects.

“Japan is experiencing strength in both inbound tourism and domestic travel, supported by its robust economic growth,” Daisuke Kitta, head of Japanese real estate at Blackstone, said. “We will apply our operational expertise and use the full breadth and depth of our global resources to support these hotels for long-term success.”

Inbound tourism to Japan hit a record in 2024, with nearly 35 million visitors believed to have come into the country, well surpassing pre-pandemic levels. The government hopes to attract 60 million annual visitors by 2030, making the hospitality market ripe for foreign investments.

— Chris Malone Méndez