Brookfield appears on track to invest up to US$10bn in Japanese real estate by the end of this decade. The asset manager recently bought an office tower, Dentsu headquarters, in Shidome central Tokyo for JPY300bn from a Japanese consortium.
The acquisition came just over a year after Brookfield invested US$1.6bn in Japanese real estate, acquiring a stake in the Gajoen mixed-use complex in Central Tokyo and a logistics development project in Greater Nagoya. It has flagged its commitment to deploy further capital into Japan, which it sees as one of the largest and most liquid real estate markets in the world, offering both scale and stability.
Japan has seen a flurry of large transactions over recent months, cementing its position as the leading real estate investment destination for foreign capital in Asia-Pacific in 2025.
In December, KKR and Hong Kong-based PAG acquired Japanese company Sapporo Real Estate at an enterprise value of JPY447bn. Early in 2025, the firm paid US$4.4bn to take listed IT company Fuji Soft private, and the deal involved selling a portfolio of 14 office assets through a sale and leaseback.
In its latest deal, PAG and KKR will acquire a 51% stake in Sapporo Real Estate, a transaction designed to facilitate a “smooth handover” across key locations including Ebisu in Tokyo and Sapporo in Hokkaido. Sapporo Real Estate owns, operates and develops a diversified portfolio spanning commercial, office, hotel and residential assets, primarily in those two cities.
Both foreign and domestic investors have been drawn by the renewed vigour of the Japanese economy. Sentiment has been further buoyed since Sanae Takaichi became prime minister and rolled out a pro-growth economic agenda. At the same time, the yen is at its weakest level in two decades and, while official interest rates are edging higher, they remain below 1%.
Ben Chow, head of real estate research for Asia at MSCI, told IPE Real Assets: “We recorded US$14bn of overseas acquisition volumes into Japan’s commercial real estate sector in 2025, including pipeline deals. This figure includes US$2.7bn classified as pending, some of which may close this year.” Chow notes that the data is accurate as of mid-December.
CBRE reports that Japan’s commercial real estate investment volume rose 68% year on year to JPY2.092trn in the third quarter of 2025, marking the highest quarterly total since the firm began tracking the market in 2005.
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