Japanese Look to Europe, Step Up Real Estate Investments in London

After gobbling up Hawaiian golf courses and Manhattan office towers, the Japanese now have a craving for something European.

The investment opportunities are plentiful with European trade barriers dissolving in 1992 and potential new markets opening up with the death of communism in Eastern Europe.

The Japanese already have been stepping up their investments in Europe, with development and construction groups, investment firms and life insurance companies leading the way.

In European real estate alone, Japanese investments totaled $5.5 billion last year, up from $3.1 billion in 1988, according to the Clark Whitehill accounting firm in London. For all the years up to 1985, the total investment was only $425 million, the firm said.

The Japanese are particularly keen on London, where investments topped $3 billion during 1989, the firm said. That compared with $2.8 billion spent in New York and $2.6 billion in Los Angeles last year, according to data from Clark Whitehill and the Kenneth Leventhal accounting firm in Los Angeles.

Paris, Frankfurt, Madrid and Barcelona also had heavy levels of Japanese investments.

Has the United States lost its allure to the Japanese? No way, experts say.

“A lot of the older players are now looking at Europe,” said Daniel Schwartz, managing director of the New York-based Ulmer Brothers investment bank.

“But they’re being replaced by newer investors who are looking at the United States for the first time.”