Tokyo, Sept. 16 (Jiji Press)–Growth in the prices of residential and commercial land around semiconductor plants in Japan as of July 1 decelerated from a year before, data from the land ministry have shown. Apparently behind the slower growth are factors such as soaring construction costs and oversupply of housing. Still, the pace of growth in industrial land prices is accelerating as demand for semiconductors remains robust, according to the ministry data released Tuesday. In the city of Chitose, Hokkaido, northernmost Japan, in which Japanese chipmaker Rapidus Corp. has a factory, growth in the price of a residential land plot near Chitose Station of Hokkaido Railway Co., or JR Hokkaido, slowed to 15.4 pct per square meter from the 23.2 pct a year earlier because soaring housing prices prompted some residents to move to neighboring municipalities, such as the city of Eniwa, where houses are more affordable. The situation changed also for commercial land. Of last year’s top 10 list of commercial land plots with the highest price growth across the country, plots in Chitose occupied the first to third places. This year, however, only one plot in the city was on the list, ranking fifth with a rise of 25.2 pct. Meanwhile, growth in the city’s industrial land prices expanded to 20.0 pct from 14.3 pct. Rapidus, which receives financial aid from the Japanese government, plans to start mass production of cutting-edge semiconductors at the Chitose plant in fiscal 2027 and is also considering constructing a second factory. After the company announced the selection of Chitose as the venue of its plant in February 2023, 50 companies have advanced into the city. Many new hotels also opened in the city. Sales of plots at an industrial park near JR Hokkaido’s Minami-Chitose Station are set to start in fiscal 2028. In the town of Kikuyo, Kumamoto Prefecture, southwestern Japan, where Taiwan Semiconductor Manufacturing Co., the world’s largest chip foundry, has a factory, the growth of price decelerated sizably to 5.7 pct from 12.9 pct for a residential land plot and to 7.0 pct from 19.9 pct for a commercial land plot. “Apartments are in oversupply” around the plant, a land ministry official said. Just like in Chitose, however, industrial land prices are soaring in Kikuyo, with three plots near the TSMC plant making it into this year’s top 10 list of industrial land plots with the highest price growth. The Taiwanese company is constructing its second plant in Kikuyo. According to the ministry data, Tokyo’s 23 special wards saw commercial land prices rise 13.3 pct, the sharpest among the capital cities of Japan’s 47 prefectures, followed by the city of Osaka, western Japan, at 12.3 pct, due to marked rises in their city centers and redevelopment areas. Data from Tokyo-based real estate brokerage firm Miki Shoji Co. showed that the average office vacancy rate in the Japanese capital’s five major wards–Chiyoda, Chuo, Minato, Shinjuku and Shibuya–in August fell 0.08 percentage point from July to 1.87 pct, standing below 5 pct, the key threshold for the supply-demand balance, for the 25th consecutive month. Atsushi Nakajima, president of major Japanese real estate developer Mitsubishi Estate Co., said, “The uptrend for office rents remains in place.” END [Copyright The Jiji Press, Ltd.]
