Photo/IllutrationA Taiwanese company is building a large hotel, left, along the busy Kokusaidori avenue in Naha. (Kazuyuki Ito)

  • Photo/Illustraion

Prices of commercial land outside the major urban areas of Tokyo, Osaka and Nagoya increased for the first time in 28 years, buoyed largely by the effects of foreign visitors, the land ministry said.

The average price was up 0.3 percent year on year as of July 1, the ministry said Sept. 19, adding that areas of Okinawa Prefecture saw some of the biggest gains.

The increase in the number of foreign visitors lifted commercial land prices not only in popular sightseeing spots, but also in other urban and suburban areas.

The ministry’s standard land prices serve as the basis for commercial real estate transactions.

Loans obtained with extremely low interest rates under the government’s monetary easing policy were invested in many areas nationwide, fueling the first commercial land price increase in local regions since 1991, the ministry said.

Okinawa boasted many of the highest price climbs among Japan’s prefectures for both commercial and residential land.

Six residential areas and four commercial districts in the prefecture ranked in the top 10 for rates of increase.

The number of Japanese and foreign travelers to Okinawa Prefecture in fiscal 2018 marked the sixth straight record high. The influx has heightened investments in the sightseeing industry, including hotels, and pushed up individual consumption.

“As soon as a store in a central area becomes vacant, it is quickly taken up,” said Takeshi Hamamoto, a real estate appraiser in the prefecture. “Those who are outside the prefecture or the country are expecting returns and investing their funds.”

A Taiwanese company is building a large hotel, featuring a large banquet hall, along Kokusaidori avenue in Naha.

It plans to open the hotel in January.

“We would like our customers to use it for wedding receptions or conferences,” an official of the hotel said.

Residential areas in Naha and surrounding locations are in high demand.

Redevelopment projects, including new apartment buildings, are under way along the planned extension of the Yui Rail monorail line to Urasoe. Four new stations are expected to open in October.

Up north, areas of Kutchan, Hokkaido, boasted the highest individual price increases for both commercial land and residential districts in Japan.

The town is a popular skiing destination for foreign visitors.

“Foreign capital is actively being used to sell and purchase land properties,” a Tokyu Resort Corp. official said.

(This article was written by Kazuyuki Ito and Miho Tanaka.)