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Forget about the latest gloomy GDP data, slumping stock listings and the Tankan Survey. If you want a intelligible indicator of the degree to which Japan's economy has declined, just take a stroll along Chuo-dori, from Shimbashi to Kyobashi.
Ginza's main thoroughfare, which just a few years ago was lined with European brand boutiques packed with glitzy goods at stratospheric prices, is increasingly becoming home to retailers where you can purchase duds with a 1,000-yen note and leave with change in your pocket.
The latest bad news, reports Aera (Feb 15), was the announcement that the Seibu department store in front of Yurakucho station would be closing within this year.
It's rumored that two retail chains, appliance discounter Yamada Denki and casual apparel manufacturer First Retailing, maker of Uniqlo and other low-priced brands, will vie for the property.
Ginza's fate is a classic example of how Tokyo's prime urban real estate can no longer sustain high-ticket retail outlets. Aside from Ginza's three venerable department stores -- Mitsukoshi, Matsuya and Matsuzakaya -- Chuo-dori, is becoming increasingly transformed into emporiums of so-called "fast fashion" -- the garment trade's equivalent of Taco Bell. Since last year alone, in addition to Uniqlo, shops from Sweden's H&M, U.S. chain Abercrombie & Fitch, and Spain's ZARA have opened new outlets.
Slated to appear from this April is U.S. retailer Forever 21, to set up shop on the premises of Matsuzakaya.
Those pricey French and Italian brands are in full retreat. Louis Vuitton waived plans to move into a new building being erected a lot formerly occupied by Gucci. Instead, the building will house a Gap outlet.
"The decline in securities since the 'Lehman Shock' has been one factor discouraging spending by the affluent," says Eriko Kato, an investment consultant at Sumitomo Trust & Banking. "With the brand shops withdrawing from Ginza, it became harder for the banks to finance Ginza properties. Fast fashions are moving in so the area still bustles with activity, but the effects of deflation are omnipresent."
Ginza properties underwent a "mini-bubble" that peaked in 2007, but since then, the plunge in property values has actually been more drastic than the rural parts of Japan suffering from population decline. As opposed to an average nationwide year-on decline in value of 5.9% (as of July 2009), commercial properties in Ginza 2-chome fell by 16%.
Gentaro Yoshino, a visiting researcher at the Japan Center for Economic Research, describes what's been happening as conforming to "The 30-year Company Lifespan Theory," a mechanism that weeds out the players which have fallen behind the times due their persistence to move unsellable products at unsellable prices.
"Deflation is sweeping down on the parts of Japan that cling to the old ways, and bringing about structural reform," is how Yoshino puts it.
But no one knows for sure how long "fast fashion" will remain in vogue. The foreign brands now rushing to get in the door may eventually beat an equally hasty retreat.
"The changes occurring in Ginza may be emulated all over the world," Mana Nakazora of BNP Paribas Securities tells Aera. "The crisis in commercial property is going to change the structure of the world's retailing industries."
© Japan Today
21 Comments
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memyselfI
material items vs. food
food will always win
my2sense
as Japan deflates like a whoopi cushion belting out a fart noise... dream is over and time to get back to work like your Grandpas did in the 50s to the 70s... Hard to believe (not) this cramped district was worth more than NY 25 yrs ago...
GJDailleult
"All over the world" is right. Deflation is coming everywhere, Japan is just further along in the process since it had a head start.
Beelzebub
I don't see anything new about Ginza keeping up with the times. In 1971, the first McDonalds opened a counter right on the street at the Ginza Mitsukoshi. I think the hoi polloi are more likely to be impressed by the place than truly wealthy and snobbish people, who do their shopping in Tokyo Midtown (or Saks Fifth Avenue).
goddog
Deflation ain't the word for it. My 43 million yen mansion is now only worth 16 million. I was in shock and heavily in debt. Maybe time to skip the country. Deflation is allowing for businesses like Uniqlo to move in, but it is killing all the rest of us.
30061015
Fast fashion? That's called a thrift shop in America.
Welcome Japan! Welcome to what American have had to put up with for two decades now, the McWalmartization of your economy, where your jobs are outsourced to China and everything you could ever hope for can be had between a bun or sold in a 100 yen shop, if you can still afford that.
pawatan
I presume you haven't poked your head into some of these 'cheap' outlets in Ginza. They are home of the 8000 yen t-shirt, which is quite a bit more than the shirts you find at Uniqlo, let alone what you find at a US thrift shop.
minello7
fortunes won and now fortunes lost,Ginza was never reality.
Richard_III
Marunouchi is increasingly better than Ginza for buying clothes. If I can't find anything there, then I will sometimes head to Ginza but it is rather uninspiring, perhaps with the exception of Barney's and Mitsukoshi.
One thing that always irritates me about Ginza is the lack of cafes.
stirfry
ginza has never been glamorous...what it has been is extortionately expensive...2 different things, although you'd have a hard time convincing the locals of that
lostrune2
But where would the enjo kosai yen now go? Or is that not as popular anymore?
cliffworks
goddog - where is your mansion? I'm looking to buy!
marushka
Mitsukoshi? I always thought it is very conservative taste depato, they have the most boring brands with the most boring items specially chosen for without fantasy people
JohnBecker
There's a particular webcam I check out once in a while, located close to the Wako building. One of the programmed views pointed down to street level, at the Brooks Brothers storefront. Last fall, it became a Uniqlo storefront.
At least Sony won't be moving.
biglittleman
I think the writers of this article is a little late. The high end shopping district has already began to shift to other places in Tokyo. In fact, it has moved to several places all competing to be the number# 1. This is nothing new here, please move on.
ronaldk
This could be a generational thing as well. People in their 20~30s grew up on harder times and even if they make good money they don't want to waste in on high margin designer stuff, rather keep the difference ourselves and take a trip or something.
tkoind2
Wow, the slow death of conspicuious consumption in Japan. For a society so hung up on appearances, this is a big deal. I for one never understood why anyone would spend so much on otherwise pretty boring items. I mean after the first gold thing, how many more does anyone really need? And LV bags, well what can I say but "why would anyone spend so much money on such ugly bags?"
Normal working people have been suffering in Japan for a long time due to bad economic conditions. It is good to see the rich are now having to worry along with the rest of us. Let's hope they learn something about being human along the way.
paulinusa
I can't say I dislike Ginza. I always stop by when I'm in town. But my favorite area to shop or just people watch is the Omotesando Dori area. With Yoyogi Park and Harajuku nearby, and backstreets filled with boutiques, it's far more interesting. And more relaxing; you can actually find a place to sit under a tree on Omotesando Dori. Try to do that in Ginza.
kyoken
Because in Japan there is no other way to express that "you made it". Buying a representative real estate is far out of reach even for the wealthy. So they "brand themselves" with luxury goods instead.
The new generation is a little hard to judge. Do they skip buying luxury goods as it lost its luster, or would they if they could afford it? What one still sees, even with trashy clothing, are the shiny accessories Japanese are famous for. Hence I think the young generation has not the funds to buy, rather than changed their taste.
tkoind2
kyoken: "Because in Japan there is no other way to express that "you made it".'
You are very right. This society has a very sad self imposed shallowness. Too often only the surface really matters.
antsjnr76
$$$$$$$$$ Who cares if the company stays there for 30 years. Now days its the fly by night mentality that rules. Make the money fast then leave.