Hong Kong real estate investors purchase property in Hokkaido, Japan for many reasons. Some buyers want vacation property in Niseko and access to the perfect powder snow. Other buyers are attracted to multi-unit rental properties in Sapporo that generate cash flow. As Hokkaido matures as a destination for business, the potential for strong returns and higher property values offers new incentives for Hong Kong investors.
Recent developments in both the business community and transportation infrastructure provide additional reasons for investors to see the value in Hokkaido properties.
It is to present an overview of the developments in Hokkaido:
- Semiconductors in Hokkaido
- Sustainable Energy in Ishikari
- Startups in Hokkaido
- Enhancing the High-speed Train Service
- Interest in Hokkaido Real Estate From Hong Kong Buyers
- The Future of Real Estate in Hokkaido
Semiconductors in Hokkaido
A major public-private partnership to build semiconductors in Chitose (“Hokkaido’s largest-ever development project”) is one of many signals about the future of business and industry in Hokkaido.
On the southern island of Kyushu, Japan, TSMC, a semiconductor, plant built in the city of Kumamoto has made headlines around the world. That project has already stimulated additional investment in the region, creating a ripple effect of new housing, banking centers and shopping, and a significant increase in construction and local real estate values.
Encouraged by the success of that project, Hokkaido has welcomed the arrival of a similar initiative: Rapidus has announced plans to build a new “next generation” semiconductor plant in Chitose.
The Rapidus semiconductor plant in Hokkaido is a joint venture that includes funding from Sony and Toyota, with additional subsidies and support from the Japanese national government. The plan to bring semiconductor production to Hokkaido includes a partnership with US-based IBM. Like the plant in Kumamoto, the momentum of the Hokkaido semiconductor factory has attracted other companies to the region, including suppliers and related businesses. Dutch semiconductor equipment maker ASML has already made commitments to bring engineers to support the Hokkaido project.
The influx of both investment capital and human resources is expected to invigorate several aspects of the Hokkaido economy. Local business activity from Rapidus and related companies will create new demand for housing in Chitose, and has already had an impact on the cost of real estate in the surrounding communities.
Sustainable Energy in Ishikari
Hokkaido has also recently announced developments in the renewable energy sector with the opening of the Ishikari Bay New Port Offshore Wind Farm in Ishikari (a coastal town located northwest of Sapporo). The wind farm is a cooperative effort of Japanese companies JERA Co., Inc. and Green Power Investment GK. The wind farm began operations in January 2024, and is noted to be the largest commercial wind farm in Japan. Large investments that are a part of the national energy strategy for Japan help bring Hokkaido into focus, and could bring more talent and attention to the area.
Startups in Hokkaido
In addition to technology advancements from Rapidus and the wind farm, Hokkaido has a program to encourage the startup culture in the region.
“STARTUP HOKKAIDO” is a government initiative working “to build an ecosystem where startups are continuously generated from Hokkaido and developed on a global scale.” Notable Hokkaido startups include aerospace companies like Interstellar Technologies, agri-tech services from Sagri, and AI-focused ventures like AWL and AIQ.
Enhancing the High-speed Train Service – From Tokyo to Sapporo
As part of a multi-year, major development plan, the Japan Railway Construction, Transport and Technology Agency (JRTT) and JR Hokkaido are in the process of extending high-speed service by train (called shinkansen, in Japanese) deeper into the heart of Hokkaido. Current service connects the main island of Japan to Hokkaido (via an undersea tunnel) through the southern Hokkaido city Hakodate. The expansion project will extend that service from Hakodate, through Niseko and Otaru, continuing to downtown Sapporo.
Better transportation and access will bring more visitors and businesses to these inland Hokkaido cities. Improved access will make it easier to live and work in Hokkaido, attract more visitors, and create more opportunities for the business community to serve locals and tourists.
Interest in Hokkaido Real Estate From Hong Kong Buyers
While the foreign-born population in Hokkaido is small, most of the tourism and investment comes from Japan’s neighboring Asian countries. These demographics are also reflected in the foreign ownership of real estate in Hokkaido. Of all the foreign populations investing in Hokkaido, investors from China, Hong Kong and Singapore are among the most common.
Local Hokkaido-based real estate company Find Hokkaido Agents shared some examples of requests from Hong Kong investors:
I am based in Hong Kong and I am interested in purchasing property in the Niseko ski area in Japan. I am looking at a house with an asking price of 115 million JPY. I intend to rent it out and maybe stay there a few weeks each year.
Skiing Lover, Hong Kong buyer
Investors from Hong Kong have relatively easy access to their property in Hokkaido. While most international visitors must fly into Tokyo, and then take a connecting flight, Hong Kong has direct flights to Hokkaido. Hong Kong Airlines, Cathy Pacific, and Japan Airlines all provide direct flights into New Chitose airport (a short distance from Sapporo).
Interested in buying an apartment in Hokkaido in a new development. I’m based in Hong Kong.
Hong Kong buyer
The natural beauty of the region, strong returns from investments, and the quality of life that comes from clean, safe cities, have made Hokkaido a comfortable place for Asian investors.
The Future of Real Estate in Hokkaido
While some parts of Japan are feeling the impact of a declining population, the pace of these new developments in Hokkaido continues a positive trend for both business and real estate.
As these business initiatives in Hokkaido take off, there is potential for substantial gains in real estate. Based on the Rapidus announcement alone, real estate values in Chitose are up significantly. Economic activity provides incentives to develop new housing for both Japanese workers and foreign workers from the US and Europe. Employees of these companies who want to take advantage of better schools and lifestyle opportunities may seek to rent and buy in Sapporo, using Hokkaido’s excellent train and subway service to commute to work. A concentration on agriculture, and the need for more land for factories, will push some real estate transactions beyond Chitose and Sapporo into the surrounding communities.
Growth in Hokkaido is creating the potential for profit for investors who can identify the best opportunities.
