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  • Writer's pictureAdam German

Odakyu Electric Railway president aims for ¥10 Billion profit with Shinjuku West Exit Redevelopment

Updated: Jun 13

According to the Nikkei Shimbun on June 12th, Shigeru Suzuki, president of Odakyu Electric Railway, has announced estimated profit levels for the redevelopment of the west exit of Shinjuku Station in Tokyo's Shinjuku district.  

 

The company is aiming to achieve an operating profit of 10 billion yen for the entire group by fiscal 2030.  

 

The redevelopment project includes a 48-story skyscraper featuring commercial facilities and offices, scheduled for completion in fiscal 2029.  


Shinjuku West Exit Redevelopment finished exterior CG courtesy of Odakyu Electric Railway 

 

This initiative is part of Odakyu's strategy to make its real estate business a more significant revenue source than its transportation business. 

Shigeru Suzuki, president of Odakyu Electric Railway

Shigeru Suzuki, president of Odakyu Electric Railway, courtesy of company website 

  

In an interview with the Nikkei Shimbun, Mr. Suzuki, who assumed his role in April this year, detailed the collaboration with Tokyu Land Corporation and Tokyo Metro to redevelop the site of the former Odakyu Department Store Shinjuku Main Building.  

 

Odakyu is investing 130 billion yen in the project. "We aim to generate 100 billion yen in profits for the entire Odakyu Group, encompassing services, dining, distribution, and building maintenance," Suzuki said in the Nikkei article. 

  

Odakyu has started construction early, anticipating further increases in construction costs. "Delays will only lead to higher prices, increased labor costs, and rising construction expenses," Suzuki explained, emphasizing the importance of securing a first-mover advantage. 

  

Facing a projected decline in passenger numbers due to population decreases, railway companies are increasingly focusing on expanding their real estate ventures along their lines.  

 

Odakyu aims to boost the operating profit of its real estate business to 30 billion yen by fiscal 2030, up from 17.1 billion yen in fiscal 2023. 

 

This would surpass the projected 27 billion yen operating profit from its transportation business in fiscal 2030, compared to 25.5 billion yen in fiscal 2023. 

  

Over the seven-year period from fiscal 2024 to fiscal 2030, Odakyu has allocated a growth investment budget of 400 billion yen.  

 

Beyond the Shinjuku west exit project, this budget will support developments along the Odakyu line, including projects in the Machida area of Tokyo. 

 

Source: 

Nikkei Shimbun (Japanese only; paywalled)

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