Source: Asia Pathways
Like the rest of the world, Asia has been hit hard by the COVID-19 crisis. While some countries have been able to contain the spread of the virus relatively well, the disruption of supply chains, sharp decline in global demand, and the large-scale withdrawal of capital have led to severe economic contractions across the region.
The COVID-19 crisis has illustrated in dramatic ways the vulnerability of our societies and economies. It has also laid bare the failure of individual countries and the international community at large to adequately prepare for pandemic risks, despite previous outbreaks, such as the Severe Acute Respiratory Syndrome (SARS) pandemic in 2002–2003 and the H1N1 influenza pandemic in 2009, and repeated warnings by virologists about the risks of even worse outbreaks.
When building back our economies after the crisis, we need to make them more resilient—not only to better withstand future pandemics but also to increase resilience against the other great threat scientists have been warning us about for long—climate change. We need to strengthen resilience and mitigate disaster risk by systematically developing and implementing policies, strategies, and practices to minimize vulnerabilities throughout society.
The financial sector will have to play a central role in this. Managing risk is one of the key functions of finance. Financial institutions need to develop their ability to better assess climate-related financial risks, including physical risks and transition risks. The frequency and intensity of climate-related disasters have grown markedly over the last decades, and parts of Asia are among the most affected regions. As shown in Figure 1, climate-related disasters in Asia have led to significant losses. Financial institutions across Asia will need to grow their capacity to analyze the effects of acute physical risks. These include risks that are event-driven, including extreme weather events, …continue reading
On May 29, luxury hotelier Hoshino Resorts announced plans to establish a fund to support domestic hotels and ryokans that are suffering from a drop in customers due to the coronavirus pandemic. The tentatively-named Hotel Ryokan Fund will be set up this summer, with an expected investment of between 10 ~ 20 billion Yen (approx. 93 ~ 185 million USD).
The goal is to support the continued operations of struggling hotels, while ensuring a quick and smooth recovery of the tourism and accommodation industry once the pandemic has subsided.
After acquiring hotels and ryokans, they will be sold off once operations have improved. The estimated turnaround period is between 3 to 5 years, with a goal of acquiring and flipping around 10 hotel operations.
Hoshino Resorts was established in 1914 in Karuizawa and currently manages 42 hotels, onsens, and resorts.
290 total views, 168 views today
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An almost-abandoned condo/hotel in Sendai City will be demolished and potentially redeveloped after sitting empty for 20 years.
According to the owners association, over 80% of the 100+ unit owners voted in favor of redevelopment at a general meeting held last autumn. In Japan, at least 80% of apartment owners must vote in favor in order for a condominium to be redeveloped. To simply demolish and sell the land, a 100% vote must be obtained unless certain conditions are met.
The condo-hotel opened in 1977 with 109 rooms. The first three floors were managed by the hotel owner and operator, with floors 4 ~ 7 designed as condo units. They were marketed in the 1970s as being the first luxury condo-hotel in the Tohoku region. Many of the original buyers purchased units to lease out to students of the nearby university, or to be used as second homes.
The hotel operator filed for bankruptcy in 1999, closing the hotel. The hotel floors were later sold at a foreclosure auction in 2002. In the years following, no maintenance had been carried out on the building’s electrical or plumbing. Squatters began moving into some of the abandoned hotel rooms.
There was no owners association until 2018 when several unit owners got together to create one with the goal of demolishing the dilapidated and potentially dangerous structure.
In 2016 Sendai carried out a survey of the city’s 1,400 condos. Of those, 13 had never established an owners association, while 79 were not collecting enough money to carry out adequate building repairs or maintenance. Condominium development in the city began in the 1970s. There are now over 300 condos over 30 years old that will be in need of careful maintenance and management in the coming years. A 5-story, 46-year old condo in Aoba ward was found to have …continue reading
The Urban Renaissance Agency, a semi-governmental housing corporation, is planning a 180-meter tall office tower for the northern end of the former Aoyama Kitamachi Apaato public housing block in Omotesando.
The lower floors are expected to contain retail and a hotel, while the upper floors will be office space. Construction of the 38-story building is expected to start in 2022 with completion in 2026 ~ 2027.
The four hectare site once contained 25 low-rise apartment blocks built between 1957 and 1968. These was Tokyo’s first post-war city housing project. Apartments ranged in size from 32 to 52 sqm (344 ~ 560 sq.ft), had no elevators, and the earlier buildings had no bathrooms.
The southern end of the site has just been redeveloped into a 90-meter tall, 25-story rental-only apartment block, and a 70-meter tall, 20-story public housing block.
298 total views, 162 views today
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Source: East Asia Forum
Author: Meijun Qian, ANU
State ownership might be crucial for sectors that are vital for social stability. Over the last half century, the consensus among economists has been that state ownership is notorious for management inefficiency. Since the 1970s, there has been a wave of privatisation globally.
But in recent years the percentage of state-owned enterprises (SOEs) in the Fortune Global 500 has risen to nearly a quarter. The increase in state capitalism over the last two decades in countries like Singapore, China, Brazil and Norway offers an opportunity to explore the nature of state ownership anew.
The necessity of containing a global pandemic also provides a backdrop to re-examine state ownership. Medical equipment that is in short supply globally — such as tests, masks and ventilators — and social distancing are crucial to combating COVID-19.
Countries with a state capitalist economy seem to be able to deal with both issues more effectively than those with free markets because the state can order an immediate shift in production to meet emergency needs. People in these countries also seem less likely to resist drastic social measures. This could be because they are accustomed to centralised control.
Producing and storing excessive quantities of medical supplies isn’t lucrative under normal circumstances. Companies must account for uncertainties in demand, incurring unpredictable inventory costs, quality maintenance and sales. But because the government can implement price controls during a disaster on humanitarian grounds, these costs might not be covered. In this situation, the market is likely to fail.
Some goods demand state intervention in unusual situations because they are critical to survival. These include medical supplies during a pandemic and shelter during wartime, as well as clean water, air and food. This category could be extended to include utilities such as electricity and services that ensure economic stability, …continue reading