Company history

Hasegawa Takehiko opened a one-man carpentry contracting shop in Amagasaki, Hyogo, in February 1937. It was incorporated in 1946 with capital of ¥195,000 and a head office in Himeji, opened an Osaka branch the same year, registered under the new Construction Business Act in 1949, reached Tokyo in 1951, and in 1953 moved its head office to Osaka. Nothing in that sequence distinguished it from hundreds of regional builders — a wooden-frame contractor with no way into the national market.

What changed the business was a single order. In 1950 Itochu asked the firm to build the Ashiya Uchide-so apartments in reinforced concrete, and Hasegawa spent to acquire the machinery that fireproof construction required — capability few contractors then had. The division of labour set there would define the company for seventy years: the trading house holds the land and the client, Hasegawa answers with construction. Work came from outside rather than being chased, and it came without a tender. Alongside it grew a second, quieter business — the company put up its own office buildings and let them, starting with the Osaka head-office building in 1957 and the Shibuya tower in 1963, where it also opened a real-estate department.

Capital was raised to list on the Osaka market in 1961, and in March 1962 the shares went to the Tokyo Stock Exchange second section; promotion to the first sections of Tokyo, Osaka and Nagoya followed in 1965. The listing prospectus already shows the pattern in miniature: 96.2% general construction and 3.8% rentals, with 72.8% of building work won by negotiation and only 27.2% by competitive bid, and no keiretsu parent feeding it orders. Half-year sales climbed from ¥210 million in 1958 to ¥3.96 billion by mid-1965, but pre-tax margin fell from 11.1% to 2.8% over the same stretch — nineteen times the volume at a quarter of the margin. Rental income was the ballast that made the swings survivable.

Japan’s condominium market barely existed in 1967 — under 2,000 units a year nationwide, mostly luxury blocks styled for foreign tastes — when Hasegawa built an 83-unit block in Ashiya. It started its own first project in 1968 with Mitsui Trust Bank, and in December 1969 tied up with the trading house Nissho Iwai, gaining a pipeline of land information it could turn into building proposals. Out of that came the model the company still runs on: find the site, carry the plan to a developer or trading house, and take the construction order without a tender. A sales arm followed in 1970, the head office moved from Osaka to Tokyo the same year, and revenue went from $30.6M (¥11bn) in the year to March 1971 to $343.8M (¥100bn) five years later — a ninefold rise. A management subsidiary, Haseko Community, was set up in 1978 and would matter far more later than it did then.

Scale became profit through standardisation. The company’s housing production system, Combus, offered roughly a hundred patterns with the structural calculations and main specifications already fixed — common sashes, common lifts, deliberately uniform design. Vice-president Gōda Kōhei said in 1980 that builders are firms that prize individuality, and that what set his company apart was having changed its employees’ thinking in the opposite direction. Subcontractors working the same drawings again and again got faster and more accurate; components were bought at about 40% of market price and sashes at under half. Because the company signed clients at the planning stage, it also collected large advances — in the year to May 1978, ¥73.4 billion received against ¥32.9 billion spent, some ¥40 billion of interest-free funding, a quarter of all liabilities. Gross margin on construction rose from 12.6% in 1977 to 19.2% in 1980, against roughly 10% for ordinary contractors. President Mizukami Yoshimi noted that the firm won nothing by tender and refused to build to anyone else’s design. In 1979 it completed 17,200 units — more than the 15,000 built by the state Japan Housing Corporation — and held about 19% of Tokyo-area and 21% of Kansai condominium construction.

The ceiling of a single market then began to show. From 1979 the company pre-bought land to secure sites, revenue peaked at $820.3M (¥204bn) with a 12.9% recurring margin in the year to March 1982, and the housing slump of the early 1980s cut that margin to 5.4% by 1985. Gōda took the presidency in 1987 and opened a new-business division in 1988 to find a second pillar. In July 1988 the company opened the Kyoto Brighton Hotel itself — 183 rooms, all suite-sized, and deliberately not carrying the Haseko name, because, as the director running it put it, the name would attach a builder’s image. Resort developments in Tateshina and Awaji Island followed, taking planned hotel and resort investment past $780.5M (¥100bn). In October 1988 Hasegawa Komuten renamed itself Haseko Corporation. The hotel’s first year beat its targets by 30%.

Diversification rewrote the company in five years: real estate went from 11% to 56% of sales. Consolidated revenue of $3.9B (¥521bn) in the year to March 1991 split ¥312.5 billion construction against ¥208.4 billion property — and then land prices fell to a quarter or a fifth of their peak, one holding losing ¥30 billion in six months. Gōda conceded publicly in 1991 that the company had chased economics too hard and got it wrong. The construction arm had been covering the property losses, but building prices halved too, so the same profit now required twice the volume. Net losses ran for five consecutive years from the year to March 1995; unrealised property losses reached ¥160 billion and interest-bearing debt swelled past $13.8B (¥1.3tn), more than four times equity.

Gōda’s answer, worked out from late 1994, was to restate the balance sheet at market value in one movement so that further falls would not matter. Land that could not be sold outside was transferred at market price to a ¥100 million shell, Eichi-Shi Land Development, funded with roughly ¥160 billion by Daiwa Bank, Mitsui Trust and the Industrial Bank of Japan; a 9,800 m² Takanawa site bought for ¥56.6 billion went to a government-affiliated body for ¥15.9 billion. In the year to March 1996 Haseko booked a $1.7B (¥185bn) special loss in a single go, taking the recurring loss to ¥118.0 billion and the net loss to ¥214.4 billion — forty times the prior year’s. Running losses every year, Gōda said, was bad for the company’s and its employees’ nerves; better to take one big hit and be back in the black the next year.

It was the entrance to the rebuild, not the end of it. In June 1998 Daiwa Bank sent Iwao Takashi in as vice-president to find group debt just under ¥1.05 trillion against ¥14.8 billion of parent operating profit. That December Haseko asked 34 lenders to forgive $3.0B (¥394bn) of unsecured claims — a uniform 48% haircut allocated strictly in proportion to each bank’s exposure, since the three main banks held only 40% and could not absorb more. Smaller lenders resisted hard, and preparations for a court reorganisation ran in parallel; the shares broke ¥100, then ¥50, and hit an all-time low of ¥13 in January 1999. A modified formula loading more of the loss onto the main banks closed the deal in 1999 and kept the company out of court. Debt-for-equity swaps converted ¥150 billion, preferred shares reached ¥142.8 billion, and the equity ratio bottomed at −22.1% in the year to March 2002 before turning positive. Every executive director stepped down over about three years, and the founding family surrendered its shares on the way out. In six years interest-bearing debt fell from just under ¥1.05 trillion to ¥184.1 billion.

Recovery revealed how good the old model was. Consolidated revenue of ¥723.1 billion in the year to March 2007 was about half a major contractor’s, yet operating profit of ¥64.5 billion beat industry leader Taisei’s ¥57.6 billion, and the parent’s completed-work gross margin of 14.4% was more than double Kajima’s 7.1%. Negotiated orders had reached 99.7% of building work, against 58.7% at Shimizu; Haseko had quit public works entirely in 2002. The industry held that condominiums were unprofitable — short schedules, squeezed prices, endless post-completion complaints — and earned about 5% on them. Haseko earned the highest margin in the sector inside precisely the segment everyone else avoided, because it owned the entrance: some 100 salespeople gathered roughly 10,000 land leads a year in the Tokyo area, fewer than two in ten reached a business plan, about 200 were built, and standardised specifications with practised subcontractors held the gap between design estimate and actual cost to around 1%. A developer offered land, a plan and acquisition support rarely walked away over a slightly high quote.

The 2008 crisis hit the buyers — salaried households in their late thirties — and revenue fell from ¥745.1 billion to ¥505.5 billion with a ¥7.6 billion net loss. Iwao warned in 2009 that this was worse than the post-bubble years and that 80,000-unit supply years would not return. What rescued the position was other people’s choices: reconstruction after the 2011 earthquake pulled contractors into fatter public work, labour shortages pushed costs up, and developers could no longer find builders who would work at viable prices. In 2011 Nomura Real Estate launched its mid-market Ohana brand jointly with Haseko, took the top spot in Tokyo-area supply in 2012, and the rest of the majors followed — orders from the seven largest developers went from under 10% to 40% by fiscal 2014. Even as national condominium starts fell 10%, Haseko’s orders hit a record and its share of condominium construction approached 30%; the Tokyo-area figure rose from 20.7% in 2008 to 34.5% in 2017. Common specification books were hammered out developer by developer at the company’s LIPS showroom, where competing makers’ fittings are priced identically so that no choice changes cost. In February 2014 president Oguri Ikuo declared the rebuild effectively complete.

The second lesson of the crisis was to build second pillars inside the same market rather than outside it. Haseko turned its accumulated construction record into recurring demand: management through Haseko Community, large-scale repair and renovation through Haseko Reform (2009), rental operations through Haseko Livenet, senior housing through the 2013 acquisition of Seikatsu Kagaku Un’ei, and development brought in-house with Sogo Jisho in 2015, with a private REIT added in 2022. Cumulative units built passed 700,000 in 2023. Operating profit reached ¥100.8 billion in the year to March 2018 — president Tsuji Noriaki called the numbers overdone, the product of a demand recovery and of rivals leaving the condominium field, and said he had no intention of setting grand targets, telling staff the company was not a large enterprise but a great small one. Revenue crossed ¥1 trillion for the first time in the year to March 2023. In the year to March 2025 it reached ¥1,177.4 billion, but about ¥23 billion of overseas losses cut net profit from ¥56.0 billion to ¥34.4 billion — and segment profit of ¥24.0 billion in property and ¥18.1 billion in services against ¥53.5 billion in construction showed how far the company had come from depending on one number.