[jorams]

> facilities were purchased for between 1 million yen and 5 million yen and resold to Chinese buyers for between 40 million yen and as much as 100 million yen depending on location

Those prices seem weird. They were buying entire care homes and hotels for less than the price of a car? I understand they come with obligations, but these businesses were apparently financially ok before the acquisition.

[decimalenough]

I'm familiar with Japan and find it quite believable.

You may be familiar with the "akiya" phenomenon, where empty houses in the Japanese countryside are sold for a song. The same applies not just to residential homes, but to other buildings as well, and their price tag is very low for the same reason: the property has serious issues and/or has been vacant for years, and will require far more than the initial investment to make habitable.

Here's a fascinating blog post by someone who went poking around the ruins of one hot spring town (Kinugawa) that went through a particularly dramatic boom and bust cycle: https://spikejapan.wordpress.com/2010/06/14/983/

This particular hotel at least appears to have been open until fairly recently, but Google reviews describe the "Showa-era" furnishings (read: 1980s at best), and it's on the fairly grim slate grey Kujukurihama beach 3.5 hours from Tokyo by train: https://maps.app.goo.gl/G53KWyCsmeUy8JyR9

[acchow]

I get that there is undesirable real estate in Japan that gets sold "for a song".

But then how does it quickly get resold at 40x?

[overfeed]

> But then how does it quickly get resold at 40x?

Because the new "owners" are buying the Business Manager visa, not the actual property.

[ludwik]

Performing 40 songs in exchange for a property does seem like serious effort...

[LorenPechtel]

Suckers who don't realize it's not worth what they're paying.

[omcnoe]

This really is a great blogpost, I'm really glad you shared it.

[ekianjo]

We are not taking about akiya here but actual businesses. A thriving business would never sell for one million yen.

[decimalenough]

What makes you think these businesses are thriving? It's scams upon scams: the Japanese mastermind buys failing businesses on the cheap, pumps up the price and sells them to Chinese people, who then proceed to use them to essentially scam residence visas from the Japanese government.

[ekianjo]

> these businesses are thriving

Maybe not thriving but they were paying salaries and bills before they were bought. They were not in a bankrupt state.

[Retric]

Not bankrupt doesn’t mean the company is actually worth anything. A large number of tiny business are still in operation because the owner is willing to work at below market rates to keep it operating.

[foundart]

Re the spikejapan blog: The author’s About page includes this line which describes my experience of the article very accurately, having bailed after a couple of minutes:

“It's a species of anti-blog, as there is no way that you'll get through a post if you suffer from any kind of attention-deficit disorder; even then, you may need a strong cup of coffee and an hour to kill.”

[eudamoniac]

Yeesh - interesting blog post, but terribly sophomoric prose, distracting and clumsy. The author is at least 40 and should know better.

[antonvs]

I respect the attempt at belletristic writing, even if it falls a bit short. If they had an editor to rein in some of the thesaurus usage it’d be fine. Not everyone appreciates the style, though.

[protimewaster]

> Those prices seem weird.

I was thinking the same thing. In many parts of the world, even a failing / debt laden business would be worth much more than that.

[bob001]

And yet companies file for bankruptcy and get liquidated all the time versus being bought.

[colechristensen]

In at least some parts of the world real estate isn't the ridiculous "investment" it is in the US.

[juleiie]

Real estate in good location is an investment almost everywhere

Good location being the key here

I doubt a house the price of a new car qualifies as being in a good location.

Tokyo on the other hand… yeah I doubt you would see anything cheaper than couple million dollars there

[colechristensen]

Your straight up guessing with zero information is ridiculous.

The average apartment cost in Tokyo is a little north of $400k (USD), since the year 2000 or so the value of Tokyo apartments has appreciated somewhere around 3% per year. Apartment prices are ALMOST back to where they were in 1989.

[juleiie]

I guess it is a small island after all. Not a great example to extrapolate to more connected economies.

Still, it is twice as expensive per square meter as my European capital city. So looking at it without any historical data it is still much more expensive even with declining population and no immigration.

More like an exception to the rule really as it really has unique conditions as opposed to rest of the world.

[bob001]

> Apartment prices are ALMOST back to where they were in 1989.

You mean when Japan was in an epic price bubble (ie: the imperial palace land alone was worth more than all of California) which was followed by decades of economic stagnation? I'd guess that has impacted their view on real estate to a somewhat unique degree in the world.