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Japanese fund targets responsible real estate

April 2005

The Tokyo investment company Green Earth has set up a fund called Ecoland to buy polluted land, restore it and resell it.

The company, due to start the fund in May, is setting aside eight billion yen ($74m, £39m) and aims to buy ten sites worth between 500million and a billion yen in the first year. The decontaminated land will be for commercial or residential use.

Toshio Fukuda, president of Green Earth, said: ‘Many Japanese investors have become aware of the need to be socially responsible and environmentally aware. This fund invites them to participate in that role.’

Having grown into the world’s second biggest economy, Japan is littered with sites polluted by industrial activity. The environment ministry estimates the country has 320,000 polluted sites, but Green Earth puts the figure at 409,000. Fukuda believes that 20 per cent of land in Japan that can be traded has failed to sell because of pollution.

The Ecoland fund is promising a higher yield from this project than from real estate trading. Green Earth, which will become part of a soil clean-up industry said to be worth 100bn yen annually, is aiming for net returns of at least 20 per cent.


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