L.A. Is No. 1 With Japan Investors : Real estate: New York loses its top spot. The value of purchases last year is down 12% from 1989.

Los Angeles has surpassed New York as the top American city for Japanese real estate investment, with the Big Apple’s skyscrapers losing favor to residential and resort properties in the western United States, according to a study released Wednesday.

The $13.06 billion in U.S. real estate purchased by Japanese investors last year was 12% less than the $14.77 billion acquired in 1989, according to the study by the accounting firm Kenneth Leventhal & Co. The shift in investment strategy from office buildings to resort and residential property, however, could set the stage for a Japanese-financed development boom that would help revitalize California’s slumping housing market.

“There are dozens of projects that are poised to begin development,” said Jack Barthell, a partner in Leventhal’s Los Angeles office who recently traveled to Japan to talk with government and banking officials.

“The purchase of land for development showed the biggest percentage gain of the total invested last year, indicating that the Japanese have confidence in the long-term strength of the U.S. real estate market,” added Jack Rodman, director of Leventhal’s Pacific Rim practice.

Investment in office properties plunged to 17% from a high of 50% in 1988. But the percentage invested in residential property and raw land last year soared more than nine percentage points from their 1988 levels to 16% and 13%, respectively.

The spending mainly benefited the West.

Six of the top 10 metropolitan areas attracting Japanese investments last year are in California. And Guam and Hawaii also attracted significant investment. The shift helped Los Angeles top New York for the first time in terms of cumulative investment as the Big Apple suffered an 82% decline in new Japanese investment.

In pressing ahead with investment in U.S. real estate--including the September, 1990, purchase of Pebble Beach Co. by Japanese golf course magnate Minoru Isutani for $900 million--Japanese investors last year appeared unfazed by either the U.S. recession or tensions in the Persian Gulf.

What’s more, last year’s total may have come closer to the 1989 figure if the purchase of MCA Inc. by Japan’s Matsushita Electric Industrial Co. had closed before the end of 1990 instead of early this year. The U.S. entertainment giant owns property valued at about $500 million, including its Universal City headquarters and its Orlando, Fla., theme park.

Nationwide, the dollar amount of the average real estate transaction made by Japanese investors fell to $43 million in 1990 from $51 million a year earlier as smaller players entered the market and controversy surfaced about the United States’ losing some of its trophy properties to foreign investors.

Japanese Investment Hotel/resort properties attracted nearly one-third of Japanese investment dollarsin U.S. real estate in 1990, far surpassing the next most popular category-office buildings. In billions of dollars Hotel/Resort: $3.79 Office: $2.16 Mixed use: $1.83 Residential: $2.06 Land: $1.72 Retail: $0.52 Golf course: $0.55 Industrial: $0.13 Other: $0.30 Source: Kenneth Leventhal & Co.