Perspectives on Tokyo Living & Real Estate

By Kenneth Arbour

Kenneth Arbour, President of Century 21 SKY Realty and Tokyo Orientations, has spent over 20 years in the real estate and relocation business in Tokyo. This is the third of four articles, in which Ken covers trends in the real estate market in Tokyo and Japan.

With his feet firmly on the ground, and with more than a little humor, in this article Ken covers the relocations market and the services his company provides corporations and expatriates.

The world of relocation services

The world of employee relocation doesn’t sound, off hand, as if it would be of much interest to the average person, or at least someone not in human resources. But this particular business niche has seen some rather dramatic changes as it has evolved over the last 10 to 15 years. No longer does a new assignee to Japan, Mr Brad Smith say, suddenly arrive with his wife Angelina at his hotel, pull out the Yellow Pages and try to find a home, a school for the kids, a doctor, a language teacher and all the things that go into living here—and not only here, but in practically any reasonably sized city in the world.

Large new global organizations— Relocation Management Companies (RMCs)—have emerged to smooth and standardize all elements of employee relocation, and have entered into fierce competition for business. And, while it is true that North American companies are probably the major users of these services, it is only a matter of time before companies around the world use them as well.

The reason is simple—economics. The cost of expatriate relocation can be huge. A failed assignment is a large loss for any company in terms of money, time, and lost opportunities and so on. However, the single greatest reason for a failed expatriate assignment is the assignee’s family.

The RMCs try to reduce the possibility of unhappiness in the family by carefully managing the move from start to finish, and making sure all services provided are at the highest level. Sometimes the RMCs provide many or all of the services directly themselves. And sometimes they contract with companies like Tokyo Orientations to provide local services such as finding homes and schools, and immigration assistance, among the many services an international posting requires.

My relationship with Tokyo Orientations began more than 15 years ago and has been interesting for a number of reasons. First of all, it has been a challenge to keep up to pace with the rapid evolution of the industry. It has changed from a very local business in nature, where the local HR department made most of the decisions, to an international business where most decisions are made by the distant and sometimes mysterious ‘head office.’

The RMCs make contracts with head office HR departments to provide as uniform a service as possible—anywhere in the world—to personnel moving to locations as far flung as Hanoi, Acapulco, New York City, and even Tokyo. These services include moving household goods, language and cultural training, perhaps initial financing of the move, local assistance at the employee’s destination to help find a place for the assignee to live, a school for the kids and other various types of assistance (opening bank accounts, obtaining driver’s licenses etc.) so that the new arrival acclimatizes easily and settles in as rapidly as possible.

Sometimes though, who and how these services are provided are no longer an HR decision. A business that didn’t really exist much more than 15 years ago, even in the US, has become so standardized globally that the decisions on which companies and services to use are being made mainly on price—and often by the purchasing department.

Now if I may regress a little. 12 years ago when Tokyo Orientations founder, Ginnie McKay, came to us saying she was thinking of selling her business and retiring to spend her time skiing with her husband in Colorado, we thought this would be an interesting opportunity to combine the synergies of two companies with similar clients. Our first business, Century 21 SKY Realty, had done a thriving business with Tokyo Orientations and the relationship between the businesses looked good.

Tokyo Orientations was a small business at the time being operated by the manager who worked on a parttime basis mainly from her home, and RMCs, at least internationally, didn’t really exist. A year later, when the manager’s husband was transferred back to the US, the single piece of equipment we inherited was her telephone/fax machine.

My, how things change. In the intervening years we have not only opened a formal office, but now have 11 full-time employees and about 20 field consultants throughout the country. We have various direct corporate clients but also strong relations with several RMCs and are part of Reloc8 (www.reloc8asia.com), a network of local relocation service providers throughout Asia Pacific. More importantly, at the same time as these relationships have evolved, the services offered have become more professional and streamlined.

The single greatest reason for a failed expatriate assignment is the assignee’s family

Even before the international assignee has stepped off the plane to search for a home, school, etc., he or she has seen housing layouts, photos, gone over school websites, and has already had lengthy discussions (and/or emails) with a local relocation professional who can normally answer any outstanding questions immediately. How can I bring my 1932 Oldsmobile Reo? How can I get Johnny on a hockey team? How can I find Johnny an English-speaking dentist after I find him a hockey team? What are my health insurance options?

The whole purpose is to ease the transition, which is pretty stressful even if you don’t have a family or young children. Ease the stress, and the family, the assignee, and the company, all have a much greater opportunity to have an enjoyable and successful time in their host country. And this success translates directly to a healthy bottom line for any company sending assignees to distant countries. That is why this business has grown and why it will continue to grow for the foreseeable future.

Ease the stress, and the family, the assignee, and the company, all have a much greater opportunity to have an enjoyable and successful time in their host country.

It all works because we are refining, almost automating, a very complicated process of moving a family from, say, Detroit to Tokyo, with the least amount of problems and fuss. Unexpected problems, when they do occur, are handled by someone who knows what they are doing. So the downtime and disruptions are kept to a minimum.

I remember reading about a surgeon who did the same 60-90 minute operation 4, 5 even 6 times a day, 5 days a week. He had been doing it for years. When he was asked by the reporter why he didn’t get bored or want to do other things, he said it was the beauty of doing his job successfully again, and again, and again.

It has been well documented that when you are having an operation it is best to have a surgeon who has done the operation many times. He or she knows what to expect and how to deal with it. This is also true when dedicated individuals are overseeing the orientation of a family to a new life in a new country. Someone who has done it many times, who knows the problems that may occur, and who knows how to deal with them quickly and correctly will experience a greater success rate. For us, it is the beauty of doing a complicated job successfully again and again.

Kenneth Arbour

Kenneth Arbour
President, Century 21 SKY Realty,
Tokyo Orientations
Email: k.arbour@century21.ne.jp
Web: www.c21sky.com