TOKYO: Malls and restaurants in Japan will miss a business boom, as Tokyo expects the Olympics to be held without spectators outside, dealing another blow to industries that were already on the ropes of the coronavirus.
In the years leading up to the games, developers poured billions of dollars into shopping and restaurant complexes to serve the influx of foreigners, with major investments in the central Tokyo district of Shibuya, famous for its busy transit.
But the number of foreign visitors decreased from nearly 32 million in 2019 to nearly zero, prompting the government to halt a spending survey that showed their consumption that year reached $ 44 billion.
Now Tokyo’s expected decision to ban foreigners from attending the Games means that the boost that the services sector relies on to offset the losses associated with the closure will not materialize.
“There was a lot of development, with new buildings being constructed, but people didn’t come at all,” said Ryota Himeno, an analyst at JPMorgan Securities Japan.
Up to eight million tourists visited the bustling clubs and cafes of Shibuya in 2019, and wing chief Ken Hasebe predicted 10 million in 2020 before the coronavirus scraps those plans.
Himeno says the projected growth has prompted developers to spend more than $ 2.8 billion in the area, which is also home to some venues from the 1964 Olympics.
The most imposing new development is Shibuya Scramble, a 230-meter-tall glass tower that has dominated the skyline since it opened in 2019.
Its developer, Tokyu Corp. spent $ 1.1 billion on projects in Shibuya in the three years to 2020.
“Unfortunately, our financial results are expected to drop into the red in the current period,” said Ryosuke Tora of Tokyo, with hotel companies taking the biggest hit, followed by railways and retail.
Across Shibuya Station, in Masaka, a vegan restaurant inside Parco department store, which reopened after years of renovation just in time for the Olympics, foreign tourists used to make up up to half of the customers.
Director Utah Nimkawa is now pinning his hopes on raising awareness of vegetarian food among locals, thanks in part to people who watch documentaries about the meat industry on Netflix.
“Part of the reason the restaurant opened was because of the Olympics, so it’s very worrying if that doesn’t happen,” he said. “It can’t be helped.”