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JAPAN: COMING ON STRONG
Bruce Newman
August 21, 1989
WITH A BOOMING ECONOMY AND A NEW INTEREST IN LEISURE, THE JAPANESE ARE INVESTING HEAVILY IN SPORTS ACTIVITIES IN THE U.S. AND ELSEWHERE
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August 21, 1989

Japan: Coming On Strong

WITH A BOOMING ECONOMY AND A NEW INTEREST IN LEISURE, THE JAPANESE ARE INVESTING HEAVILY IN SPORTS ACTIVITIES IN THE U.S. AND ELSEWHERE

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It is the fourth of July, 1989, and at the Sheraton Makaha Resort and Country Club on the island of Oahu, Hawaii, a group of Japanese tourists is having a wonderful time hacking around the golf course. Toshinori Komatsu, a salesman from the Tokyo suburb of Chiba, surveys his surroundings and says, "The mountains, the ocean, the hibiscus and the birds. You can't get any of this in Japan. I belong to a club in cherry blossom country, one hour from my home, but because of my business and the distance, I only get to golf two or three times per month. It costs only one third as much for the greens fees here, but I don't come to America because it's cheap. The golf and the scenery of Hawaii, that is something that money can't buy."

Oh yes it can. The Japanese are already in the midst of what amounts to a semifriendly takeover of the golf industry in our 50th state, where almost half the golf courses—22 of 48—are now in Japanese hands. In addition, virtually all of Hawaii's new course development is controlled by Japanese. Last year an adviser to former prime minister Yashiro Nakasone told Forbes , " Japan would be glad to purchase some of America's assets. Hawaii, for example." He was only half-kidding.

Hawaii is only the tip of the volcano, so to speak. Overall, Japanese spending in the U.S. doubled in 1988, thanks in large part to the strength of the yen, which has gained about 45% in value against the dollar over the past four years. While the Japanese deals have largely been bonanzas for the Americans who have sold out, they have done little to reduce the massive trade deficit ($52 billion) with Japan. These deals have also raised some troubling questions about who will control sports and leisure in the U.S., and indeed in the rest of the world, by the turn of the century. The so-called Japanization of sports has already begun:

?In a staggering display of power shopping, the Japanese, whose passion for golf has no limit, have spent more than $350 million acquiring U.S. golf courses in the past two years alone. They bought the La Costa Hotel and Spa in Carlsbad, Calif., for $250 million and spent $108 million for the venerable Riviera Country Club in Pacific Palisades, near Los Angeles. Although their firmest foothold is in Hawaii, Japanese investors have snapped up a number of public courses and private clubs all over California and are growing increasingly active in places as far away as Georgia, Florida and New Jersey.

?Two years ago a Japanese company bought Turnberry (page 52), a place with a tradition as thick as its Scottish burr and a jewel in the crown of British golfing. There is a suspicion abroad on the heather that the British golfing community quite deliberately encouraged the Japanese to buy Turnberry. "The Brits think the Japanese are slow golfers, and this is one way they can control them," says an American businessman who has lived in both London and Tokyo. "The Japanese smoke cigarettes, drink a beer, eat lunch and move around the course in five hours, while the Brits play 36 holes in one day. Now they can say, 'Why don't you go play at Turnberry? You own that.' "

?Japanese corporations have acquired Steamboat and Breckenridge, two of the three busiest ski resorts in Colorado, and Stratton Mountain in Vermont for a total price believed to be more than $200 million. They have owned Mount Alyeska, the largest ski resort in Alaska, since 1980.

?When Pete Rose surpassed Ty Cobb's alltime record for base hits in 1985, the bat he did it with was Japanese, made in Osaka by one of the world's largest sporting goods company, Mizuno (page 62).

?While the Japanese produce relatively few world-class athletes, one of their baseball teams has the only big league hitter with a chance to bat .400 this year: Warren Cromartie, the former Montreal Expo now hitting .404 for the Yomiuri Giants (page 68).

?The Japanese have begun investing in minor league baseball, recently buying the Class A Visalia Oaks of the California League. The Oaks have four Japanese players, a Japanese coach and an interpreter who can give the bunt sign in two languages. "They need a little more Americanizing," says Don Drysdale, the former Dodger great who serves as president of Japan Sports Systems/ USA, the company that owns the Oaks. "It's like somebody has given them a book on how to play baseball." Drysdale does not rule out the possibility that his company might go after bigger fish, perhaps a major league franchise, one day. "We will look," he says, "and if something is worthwhile we would conceivably look higher. It wouldn't surprise me if the Japanese bought a big league team. They have the resources to do it." Indeed, George Argyros, the owner of the Seattle Mariners, has said he has been approached by Japanese investors.

The Salinas Spurs of the California League also have a Japanese owner, Don Nomura, who has a 50% interest in the team. Nomura, 32, played college ball at Cal Poly-Pomona and pro ball in Japan for the Yakult Swallows. Seven Japanese players are being seasoned by the Spurs, and Nomura sees the Japanese purchase of minor league U.S. teams as a trend that will continue. "The Japanese are very conservative," he says. "But if they see somebody do well, they will follow the leader."

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