On the sixth floor of a fashionable department store in Tokyo, discriminating shoppers browse for that special something, such as a tract home in Orange County or a condo in San Francisco.
Japanese with a yen to invest in U.S. real estate merely have to step off the elevator to see what's for sale 10,000 miles away. Mounted on a kiosk on Tokyu's sixth floor is a video cassette recorder ready to roll with the latest scenes of California's best housing buys.Grubb & Ellis Co. of Irvine has made purchasing property in California and Hawaii as convenient as watching MTV, but only Tokyo residents need apply.
On Oct. 1, the real estate company, in collaboration with Citicorp, introduced at the upscale downtown Tokyo department store videotaped presentations of some of its available residential real estate.
Potential buyers can fast-forward to watch a professionally produced video of the interior and the exterior of several homes for sale in Northern and Southern California suburbs and Hawaii, as well as scenes from surrounding neighborhoods, said John Allen, Grubb & Ellis senior vice president and director of Asian marketing.
"There are many small firms in the United States that are headed by people from Japan and there are other Japanese firms that buy U.S. property and resyndicate it in Japan, but I think we're the only U.S. company doing this."
So far, he said about 50 people have inquired about the company's properties, but no sales have been made yet.
Living in an island nation in which space is limited, where a 1,000-square-foot "rabbit hutch" of a house sells for $1 million and where the U.S. dollar is weak, Japanese buyers increasingly have turned to the United States as the new frontier of real estate.
Japanese investment in U.S. land, however, is nothing new, and some Americans become noticeably irked by what they view as their communities being gobbled up by foreign companies with names they can't pronounce.
Allen said his company is aware of the strong feelings generated by foreign investing, and insisted that if a seller does not want his property offered in Japan, it won't be.
"Because we have direct access to Japanese buyers, that must bother some people. We think that's inevitable, but I haven't personally experienced that yet." he said.
"We sent out 100,000 announcements of this service in our newsletter that goes to our customers and we received only one negative letter about it."
With Japanese investors buying everything from major U.S. hotels, amusement parks and suburban minimalls, one would think the wealthy Tokyo businessman would rush at a chance to buy a multimillion-dollar home in San Francisco or Los Angeles.
But Allen said his company's unscientific marketing research shows the average Japanese overseas home buyer is looking for a $250,000 condo or $500,000 to $700,000 tract house.
"They're not just confined to buying high-priced homes," Allen said. "We can't get exact marketing information in Japan, so we have kind of gone by guessing.
"What we've found is that the interest in the midpriced home is much higher than a million-dollar house."
Allen said Grubb & Ellis, whose business is 75 percent commercial property sales in California and Hawaii, is the only real estate company - Japanese or American - that has such an arrangement at the Tokyu department store, which has agreed to promote the video service through advertising and direct mail.
Next month, Allen will travel to Tokyo to present a weekend seminar in conjunction with the store for about 200 of Tokyu's best - and presumably richest - customers on the available California real estate market.
"They were selected from the better customers," he said. "Better in the sense of most active, buying the most goods and hopefully having the most money."
As a result of the seminar, Allen said he hopes to prepare, with the help of the Tokyu store, the first visit by potential Japanese buyers to several of the California and Hawaii property sites.
"Tokyu will sell the travel tickets and we'll sell the homes," he said.