The financialization of rental housing in Tokyo.

• Japanese residential REITs rank second globally in terms of capitalization. • Their development has been initiated and strongly supported by the State. • REITs have also forged arrangements with corporate groups to accommodate their staff. • However, their housing supply does not match the bulk of Tokyo's residential demand. Over the past two decades, the private rental sector has grown significantly in Japan. Once an overlooked sector of the market, it has been seized by the financial industry to the point of becoming the second largest REIT residential market in the world. This paper explores the development of residential REITs in Japan, in a context of demographic decline and urban shrinkage. It highlights the strategies of major Japanese real estate groups to diversify their activities and strengthen their control over popular downtown Tokyo neighbourhoods, building on government initiatives to revitalize land markets and stabilize the banking system through real estate investment instruments. As the paper shows, the need to secure financial investors' expectations of attractive returns has led REIT asset managers to target the vast majority of their leasing activity to Japan's young, "promising" corporate employees. By pointing to the mediation of large corporations in the landlord-tenant relationship, the paper brings these neglected actors into the framework of financialized rental housing, and puts the analysis into the broader context of employment. [ABSTRACT FROM AUTHOR]