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| Trade Mission to Tokyo and Osaka, Japan October 2003
Photos
Monday, October 20, 2003 Breakfast, and then off to a meeting with the NAR delegation - President Cathy Whatley, Past President Martin Edwards, Incoming President Walt McDonald, NAR's Chief Economist David Lereah, Miriam Lowe of the NAR International Section, Takashi Misawa and Jonathan Kaji, the two men who had organized the Summit for NAR, and Morris Goins, NAR President's Liaison to NFRETA - first at the Hotel Okura and then at the U. S. Embassy. I was expecting a really great embassy in Japan, the world's second greatest economy and our biggest trading partner. Wrong. This place looked like it might have won an architectural award in the 60s (I'm being kind) but truly had been a victim of benign neglect from that point on. It needs a major facelift. Government issue leaps to mind when describing the furnishings, no, let's just say everything in this place. I'm not saying it's really bad but after our briefing, THE Commercial Attaché, Stephen Jacques, invited us to visit the Embassy gift shop in the cafeteria. Tacky doesn't quite describe it. After that, we went with the NAR delegation on a visit to the Roppongi Hills Development which was absolutely fantastic. Everything is here. Condos, offices, shops, earthquake resistant construction, just unbelievable, including the Mori Art Museum on the 52nd floor and the garden on the roof which is eight feet deep and is an integral part of the earthquake resistant design. Next we went to the Takanawa City Tower Formal residential condominium project where even we real estate "experts" couldn't figure out what the per square foot purchase price was. Japan - U.S. Real Estate Industry Summit Details Tuesday, October 21, 2003 It didn't take long after arriving to see what the make up of Japanese high real estate business was. Males, almost all of whom were well into their sixties or older made up almost all of the room. Everything is hierarchical, very formal and very dignified. A more outstanding observation of the one hundred fifty invited guests was that there were two females from NAR, three females from VAR and seven Japanese females, all service workers. Male dominated doesn't even begin to describe this situation. The meeting was a smashing success for VAR in that NAR included us all along the way and even invited us to be part of the gift giving process - an ultimate honor with no corresponding ceremony or importance in American business. At the end of the Japan - U. S. Real Estate Industry Conference ("The Summit") NAR President Cathy Whatley came up to me and said, "Tom, every once in a while something extraordinary happens and this is a case of Virginia being at the right place at the right time." A few observations of the actual physical makeup and setup of the meeting: It was very formal, deferential and hierarchal. Everything was provided for at the main table but nothing for the remainder of the audience. In a Japanese business meeting such as this, we should stay conservative- black suit and white shirt for men, black, dark or muted colors for women, definitely not bright colors. All of the major participants were males and most were well over sixty years old - what some referred to as the problem. Not a single female was present except in a support position. American real estate is organized vertically - local, state, national - while Japanese real estate is organized horizontally NFRETA, etc. Part of this has to do with the fact that our two industries operate in a totally different manner. Phyllis Willoughby, Faye Dillman and Carole Umbel were very quick to assess the situation, to realize that we were in a totally different business environment and to decide that the greater good for VAR was to take advantage of an incredible business situation and to worry about social issues at another time. This trip was not inexpensive. However, we should have been better prepared for the financial obligations and better prepared for more people to have been in our delegation. The Policy Board must have a quick and massive education concerning this project we have signed on for. I said this trip was not inexpensive. We spent more than was allotted and I take full responsibility for that decision but the decision had to be made on the spot. However, I must point out that we found ourselves in a situation where other people assumed we had done our homework and took us under their wing as if we had. NAR included us in almost all of their meetings and events and took us along at their expense. NAR President Cathy Whatley, Past President Martin Edwards and President Elect Walt McDonald treated us as equal parties at every turn. Whether it was a briefing at the U.S. Embassy, private meetings with business leaders, small private confidential sessions, dinners, whatever - we were part of the group whenever possible. And in an event of enormous proportions, Cathy Whatley included Virginia in all of her remarks at the Summit meeting and invited me to participate with her in the presentation of gifts to the Summit's main speakers. There is simply nothing in its importance in American business practice which equates to this gift giving ceremony. And one of the reasons we were allowed to participate was the foresight of Carole in having brought Virginia related gifts from Virginia and Faye's knowledge to wrap the gifts in rice paper - a huge hit with the recipients and a fact not lost on the NAR leadership. I approached this trip wanting to get VAR started on a path of being known for business development as well as being known for its sterling representation for lobbying for member issues. With this trip to Tokyo, we were able to not only get to first base with NAR and the Japanese but also to probably round second. It is no exaggeration to say that at the October 21, 2003 Summit, Virginia hit a home run. With that home run comes an incredible amount of responsibility. More Policy Board members must be involved. Proper funding must be planned and planned for events in the years to come. But this is an investment that I am convinced will bring us enormous returns. And I cannot thank the NAR leadership enough for their investment in us here at the beginning. What they did for us would have cost tens of thousands of dollars if we had to do it on our own. This fact cannot be overstated. Wednesday, October 22, 2003 Carole, Phyllis and I met with Sam Sadamura, Masayoshi Fujisawa, Noriaki Shiomi and Yasunori Yamamoto (Sam, Mark, George and Tiger as they told us to call them) regarding IREM, CCIM, CPM and other property management issues. They peppered us with questions on how the property management business was conducted in the states. It turned out that they operate on a smaller scale of units than we do whereby a property owner has a manager manage his individual building. The concept of property management companies managing large numbers of units does not exist. These four men were a totally different group from the men at the summit. Probably in their thirties, they were nattily dressed, very friendly and animated, less formal and reserved and totally interested in us as individuals. They had brought with them the latest gadgets which included the smallest Panasonic PC I had ever seen (in a stainless steel case); picture phones and a couple of items I still don't know what they were. However, there were some consistent patterns. The presentation of the business cards, although a little less formal, was nevertheless very important. The Japanese are not large consumer goods consumers like Americans. Space is an incredible luxury item in Japan. There are no walk in closets or other options like that. Mark showed us a new eleven unit apartment building he manages where the owner got higher rents than normal because he had figured out a way to lift up panels in the floor between the joists and use the space underneath the floor for storage. Very simple premise - more storage, wherever it might be, meant higher rents. Back to similarities. Personal appearance was, as usual, very impressive. These guys looked successful and dynamic. They had energy. They focused on our comments and acted like we were honored guests from whom they could learn. Much more than Americans, they didn't drift from the topics at hand. After an hour and a half, we exchanged gifts. Carole had IREM koozies and very nice IREM brass coasters for each of the men. Although they were delighted with the gifts, it was obvious they did not know what the brass coasters were. I put a tea cup on one coaster for them and their expressions were priceless. They had discovered something new and would have something their friends and business acquaintances did not have. For whatever reason, a standard item in the States was not one in Japan. They presented us with very beautifully wrapped 2004 Japanese calendars. Thursday, October 23, 2003 Lunch followed with Morris Goins where we talked about the upcoming meeting with NFRETA. Leaving for the meeting, out drivers could not find the office because of the Tokyo numbering or non-numbering system. Buildings are assigned numbers based on when they were built, not street numbers, so finding anything in Tokyo is a challenge. Our meeting with Shinji Fukui and Taketsugu Sugiura at NAFRETA was very productive. Barbara Nesbitt of the Japan - Virginia Society met us there. We had a great exchange of questions and answers and the two gentlemen, while the same age as the men at the Summit, were much more engaging and willing to talk to the ladies. I believe we will be seeing more of these people, especially in the states. They seemed very willing to consider coming to our VAR convention, even more so when they discovered that it would be in Atlantic City and had gambling. One of the incredible facts that we learned about Japanese real estate in the meeting was that there is no value placed on the improvements on land. Land is so valuable and such a prized commodity in Japan that all of the value is placed on it and nothing else. Income of the building is, of course, important but the building itself is considered a liability. Also, sales prices of land and buildings are not public knowledge and all parties seem intent on keeping it that way. They see the American system with pubic access to information as an invasion of privacy. Buildings are always being torn down to make way for new buildings. They refer to this as "Urban regeneration" not "urban renewal" as we do. Another fact was that there is no private ownership of any beachfront property. It, like most of the mountain area, is owned by the government. Friday, October 24, 2003 Off to the Tokyo Train Station for our trip to Osaka. The trip through the "countryside" toward Osaka was also enlightening. The Japanese use every bit of land for a purpose. Gardens butt up against factories, rice patties are next to train tracks, playing fields are next to rivers and cars are parked everywhere - but always in an orderly manner so as not to be obtrusive. And, of course, housing is everywhere. Since land is at such a premium, houses tend to go up instead of out and there are far more apartment buildings than here in the states. But, again, everything is so clean. We arrived in Osaka, a huge bustling city and were taken to our hotel, The New Otani, which was beautiful. The staff wore what seemed to be green tartans and bent over backwards to serve. Everything is spotless. Our room overlooks the River and the Osaka Castle. How it could be better I don't know. Saturday, October 25, 2003 We met the rest of the group and took off for our self guided tour of Asaka Castle, lunch at the castle and then a boat ride on Osaka's Okawa River. Sunday, October 26, 2003 At 7:30 AM, exactly, out tour bus left for Kyoto, the ancient capital of Japan. Our tour guide told us that Kyoto means "Capital City" and Osaka means "Big Slope." Japan is the size of California but with 125,000,000 people crammed onto 25% of the land, the rest being mountains. We went first to Nijo Castle and its "nightingale" floors of the Shogun Tokugawa Ieyasu and then to Kinkakuji, the golden temple built by Shogun Ashikaga Yoshimitus. We learned that if it's a temple, it's Buddhist and if it's a shrine, it's Shinto. The Japanese believe that all gardens must reflect nature. Since Japan is an island, all gardens must have an island. Odd numbers are lucky for the Japanese and even numbers signify bad luck (our hotel had a 13th floor). The number 8 is an exception. It is considered lucky since the lotus flower has eight holes in its stem. Lunch followed at the Kyoto Kokusai Hotel and then shopping at the Kyoto Handicraft Center. The tour's last stop was Sanjusangendo, featuring 1001 statues of the Goddess of Mercy. We arrived back at the Hotel at exactly 4 PM. A reception in the Virginia Suite on the 18th floor and the welcoming dinner concluded the day. Southeast U.S. Japan Summit Details Monday, October 27, 2003 The day started off with a Delegates' Buffet Breakfast, followed by the Opening Ceremony. The two Chairmen (one from Japan and one from SEUS) spoke, followed by the Mayor of Osaka, then the highest ranking member of the delegations from South Carolina, Alabama, Florida, Georgia, North Carolina, Tennessee and Virginia, concluding with the Japanese parliamentary Secretary for Foreign Affairs. The Chairman of the Kansai Electric Power Company spoke at Plenary Session I followed by a luncheon and speech by the Consul General of the United States of America Osaka-Kobe. Carole, Dave, Phyllis and I each went to a different break out session, then got back together for a Panel Session led by the Chairman of Fuji Photo. It is very difficult to find the superlatives to describe the "Cocktail Reception and Dinner" which followed at Studio 33, Universal Studio Japan. The Terminator, Back to the Future, E. T. and incredible food and drink don't even begin to describe an evening I will never forget. Tuesday, October 28, 2003 We attended Plenary Session II where the main speaker was the Chairman of Toyota Motor Corporation. At the conclusion of the session, we took taxis to the Osaka Train Station to get the Bullet Train back to Tokyo. Wednesday, October 29, 2003 A long flight back - but shorter than going over thanks to tail winds. A very satisfying feeling coming from a very productive trip. The main event I will remember from this day was that I got to see the sun rise twice. The following highlights were submitted by Carole Umbel:
Other concerns:
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