A New Wave in Technology and Real Estate Investment

Article published in Akiya Lab | Roopt (Makigumi)

Makigumi, which operates Roopt, constantly researches case studies and other information on vacant house revitalization and publishes them as columns.

Innovation in Construction Technology

Due to recent advancements in construction technology, the traditional concept of depreciation periods is changing. Modern buildings now possess durability that allows for use over 100-year spans. Particularly in rental properties, share houses, and accommodation facilities, it has become clear that user satisfaction stems from different sources than before. Consequently, investors are beginning to question the application of standard depreciation periods, leading to differing views with financial institutions. The idea is emerging that in the coming era, the usable life of buildings should be considered semi-permanent.

Necessity of Quality Assessment

A new approach is required for building quality assessment. While update evaluations for individual parts and the spread of inspections are progressing, further dissemination is needed. For detached house construction, standardization of inspection reports is required. Furthermore, due diligence (DD) for asset valuation is proposed. Especially for older properties, the importance of inspections is increasing, and renovating water facilities can enhance the building's value.

Liquidation of Investments

The liquidation of real estate investments contributes to sustained high values. Illiquid real estate tends to be traded at prices below its intrinsic value. New investment schemes such as minor amendments to the Real Estate Specified Joint Enterprise Act, real estate crowdfunding, and the utilization of DAOs and tokens are attracting attention. For example, the case of Roopt Kagurazaka demonstrates a concrete example using tokens. In exit strategies, maximizing value through liquidation is also a crucial point for investors.

Renovation and Utilization

There is an increasing number of cases where landowners or building owners undertake renovations and plan for subsequent utilization. When renovation companies can more easily procure funds, more projects become feasible. In particular, high returns on investment can be achieved through operations such as vacation rentals. The collateral value after renovation is also high, making it a safe investment even with a full loan.

Along with technological advancements, the world of real estate investment is also changing. Improvements in construction technology, evolution in quality assessment, liquidation of investments, and new approaches to renovation indicate the future direction of real estate investment.

First published: Akiya Lab (2024 - now integrated into this site)