Kennedy-Wilson Buys Tokyo Office Building

Kennedy-Wilson Inc. acquired a Tokyo office building for $50 million in one of the first real estate purchases in Japan by a U.S. buyer backed by a Japanese financial institution.

The 86,000-square-foot building is in Tokyo’s Chiyoda district, said Richard Mandel, president of Los Angeles-based Kennedy-Wilson’s commercial group.

“This is the first time a major Japanese financial institution has backed a U.S. investor in the buying of property in the country,” Mandel said. He declined to identify the Japanese institution.

The purchase comes four months after Kennedy-Wilson paid $94 million for five Tokyo office buildings, totaling more than 200,000 square feet of office space. Kennedy-Wilson said it’s the largest U.S. real estate company operating in Japan, which it entered in 1989. It manages $500 million worth of properties in the country.

Japan has been making headway in its efforts to clean up soured real estate loans and investments. Earlier this year, the country made it possible for real estate investment funds to sell shares to the public in an effort to help bring more capital into property markets. Japanese land prices have fallen for 10 straight years.

Real estate investments in the country by U.S.-based concerns have mainly been by Wall Street securities firms and funds whose investors include pension funds and endowments.