Olympic legacy: Looking at the effects of the 2020 Olympic Games on Tokyo's local real estate market.

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Author: Kiyoshi Inomata
Date: July-August 2021
From: Journal of Property Management(Vol. 86, Issue 4)
Publisher: Institute of Real Estate Management
Document Type: Article
Length: 1,205 words
Lexile Measure: 1400L

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A Google search for Olympics abandoned buildings" brings up over 1.4 million results. Estimates for the 2016 Summer Olympics show that hosting the games cost Brazil as much as $13 billion, yet less than a year later, the site of the Olympic Park was abandoned, with weeds growing in between sections of concrete in the plaza.

This is just one example. There are structures in countries around the world that are quickly abandoned and fall into disrepair after hosting the Olympic Games.

The 2020 Summer Olympics are currently scheduled to be held in Tokyo this July and August, a year delayed from their original date due to the COVID-19 pandemic, which could cause the games to again be postponed or ultimately canceled.

Whether or not the games are held, Tokyo provides an interesting case study to examine how the Olympics can affect the real estate market. It has been seven and a half years since Tokyo was selected as the host city and 57 years since Tokyo last hosted the Summer Games in 1964. We can start to ask whether the games will be a waste of money for just a few weeks of celebration or whether sustainability could become a larger focus.

Been here before

In 2013, immediately after Tokyo was selected as a host city, the Japan Real Estate Institute (JREI) conducted a survey of investors titled "The impact of the decision to hold the Olympic Games on demand." Most respondents agreed that demand would be limited to the area around the venue and Central Tokyo. In fact, no respondents believed that the games would affect demand in other prefectural capitals, and only 7% believed that they would affect demand in the central area outside of the Tokyo suburbs.

There are two reasons for this.

The first is that...

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