Page 58 - U4SSC Compendium of practices on innovative financing for smart sustainable cities projects

12 Urban development - Ogal Shiwa – Public real estate programme
(Japan)

Size of investment: approximately USD 60 million

Start date: 2011

End date: 2017

Project stage: maintenance

Project partners

• Public partners:

o Shiwa town (Iwate Prefecture)
o Toyo University

• Private partner: Various local companies

Project description

The town of Shiwa, a small municipality with a population of about 34 000 in the Iwate Prefecture
(Japan), developed a 10.7-hectare plot of land in front of their train station. After ten years of
economic downturn and harsh financial conditions in the town, it was determined that the site could
be used to create economic activity and generate new revenue. To accomplish this, the public real
estate programme, Ogal Shiwa, was developed and it included the development of approximately
60 housing units and additional sub-projects such as the redevelopment of the old town hall, a new
public library complex, football centre and a hotel complex. These new public facilities attracted
visitors to the area and made the town more attractive for small and medium businesses such as
cafes, restaurants, a farmers’ market and other small retail.

To successfully execute the projects, the town concluded a memorandum of understanding
with Toyo University to conduct a feasibility study for PPP. The study focused on determining the
potential strengths of the town and the site. With the envisioned businesses, the study found that
the town’s location between several large cities and easy accessibility by train could potentially
attract customers from other cities. Moreover, the town produces good quality agricultural products,
which could be marketed to the potential visitors from larger cities where these products are not
widely available.

Toyo University suggested that the project should create a local economic ecosystem that is based
on local production and would involve local labour and culture, rather than creating a generic
project like a large shopping mall. With the positive results of the study, the town developed a

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