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AQ Group's construction vision for Japan and beyond

Interview - February 26, 2024

AQ Group, a pioneering force in Japan's construction industry, discusses the shift towards sustainable, disaster-resistant housing and their ambitious plans for international expansion, culminating in the transformative Re:Tree Project.

TOSHIYA MIYAZAWA, PRESIDENT OF AQ GROUP
TOSHIYA MIYAZAWA | PRESIDENT OF AQ GROUP

The last construction rush in Japan was before the 1964 Tokyo Olympics, more than 50 years ago. As demographics change, the demand for new construction projects in Japan is declining, while the focus is increasingly on maintenance and upkeep. In relation to your company, what is your perception of the current construction market in Japan?

It is certain that the current demographics have caused the stagnation or decline of the construction market in Japan. Our country is facing the challenge of aging infrastructure, including housing and buildings, and there is a growing need for renovation and modernization. While renovation is on the rise in the construction market, Japan's culture tends to favor new, modern buildings. Many "new towns" and communities built decades ago are now dilapidated and may not be attractive to younger generations.

In contrast to the West, where the culture is to preserve old homes and buildings, Japan has historically had a "scrap and build" culture, with a strong desire to live in newer units. As a result, the Japanese construction market is at a tipping point in terms of values and technology. While convenience to major cities used to be a top priority, the emphasis is now on creating new and attractive cityscapes. Recent trends in housing requirements include functionality, environmental friendliness, and protection against earthquakes and other natural disasters.

Traditionally, Japanese housing has been known for its small size and limited living space, with the "rabbit hutch" as it has been called. However, this trend is gradually changing, and there is a growing demand for larger, more spacious spaces and homes. Although the market for such housing is relatively small, the need for such housing is growing, and we aim to meet this demand.

 

Aqura Home, a custom-built home that offers free design and comprehensive care services from exterior to interior and equipment, is the most well-known brand in your company. How do you market to prospective customers to encourage them to consider building or purchasing an Aqura Home? What are the specific advantages and benefits of an Aqura Home?

We believe it is essential to proactively create and shape the market by closely matching our offerings with the needs and desires of potential buyers. By doing so, we can increase demand for our Aqura homes. We believe that it is of primary importance that Aqura Homes meet the basic requirements and livability standards of modern homes. In particular, we consider safety and security against earthquakes and other natural disasters to be of paramount importance. We conduct thorough research and development aimed at exceeding the highest national standards for disaster-resistant buildings, and we strive to exceed those standards by 110%. Our homes are rigorously tested to withstand earthquakes of magnitude 9.0 (Great East Japan Earthquake) or greater, and can continue to be lived in even after a major earthquake strikes.

We have actively conducted seismic tests on 5- and 10-story wooden buildings. We have also conducted pioneering tests on typhoon durability, proving that Aqura Home homes can withstand strong winds. While many traditional Japanese homes have more walls and more compact rooms in order to be strong enough to withstand disasters, our approach is to emphasize functionality and livability. We are working to provide homes that are not only durable and disaster-resistant but also energy-efficient, spacious, and more comfortable living environments.

We have also developed an original whole-house air conditioning system called "Takumi Air Conditioning" that employs advanced proprietary air conditioning technology. This saves residents energy costs. Aqura Home homes may be 10-15% more expensive than lower-priced homes, but when compared to options from major homebuilders (well-known housebuilders in Japan), they are 15-20% less expensive while offering superior functionality. Buyers can customize their homes to meet their individual needs, such as changing the size of rooms as their lives change. We believe that this flexibility enriches people's lives.

 

Your company is currently working on a special wooden building construction project in Saitama that integrates various proprietary technologies that are particularly resistant to natural disasters. Can you give us an overview of the project and the main features of the housing? Can you also tell us about the expected impact of this project if it is successful?

Traditionally in Japan, wooden houses have been limited to three stories due to earthquake resistance. In this context, we have been accumulating research and development in this field, and recently we are working on joint research and development with Professor Masahiro Inayama of the University of Tokyo, who has been involved in the wooden portion of the National Gymnasium and other projects. This joint development and ongoing research have made it possible for AQ Group to build taller wood-frame buildings, up to eight stories tall, and we are currently working with Professor Inayama on the design and construction of a new wooden building that will be built in the future.

One of our motivations for taking on the challenge of designing an eight-story wooden building was to incorporate and carry on some of the traditions of Japan. While such structures may not be common today, Japan has a rich history of building memorable wooden structures. For example, many of the castles, temples, and shrines in Japan, including Horyu-ji Temple in Nara, are wooden structures, reaching heights of 20 to 30 meters or more. Our ancestors and predecessors have proven that such structures are buildable.



Do you participate in collaborative efforts and research with overseas institutions and companies, with the idea of utilizing and applying their expertise to your company's construction projects?

We are actively seeking partnerships with engineers and researchers around the world to facilitate technical R&D exchanges. One of our major collaborative efforts is our participation in a 10-story wooden building shake table experiment in Colorado, USA. It was interesting to see that the building was structurally joined internally with large hardware, which is a different approach from our construction method. Our construction method is inspired by the traditional wooden frame construction method, and apart from the nails, the number of metal parts used is significantly reduced. We have the technical capability to design and construct wooden houses without incorporating metal into the wood.

One of the interesting aspects of our earthquake-resistant design is that it differs from the common approach in Japan, where seismic isolation structures are assembled into the foundation. Because we do not require such a system, our wood construction is more cost-effective and shortens the building process.

 

In 2021, AQ Group is establishing its first overseas office in Vietnam. Please tell us why you chose Vietnam as the location for your first international expansion. In addition, as part of your international strategy, can you tell us about your company's future plans and which countries and regions you see as having the greatest potential for growth?

Our business in Vietnam was initially focused on importing building materials, but now we are focusing on absorbing and introducing original technologies we have developed. We are also working to expand our local staff in Vietnam. We believe that our construction methods can be applied internationally in the future and that there is a market to nurture. This approach will lead to very efficient and cost-effective housing construction, as we can use pre-cut fabrication plants to manufacture columns and beams.

There is a demand to show the beauty of wooden houses without hiding the wood under other building materials, and we see potential in approaching this demand on an international scale. Our strategy, however, is to begin by strengthening our domestic market and expanding our capabilities in Japan, including the construction of high-rise wooden houses and buildings. After that, we would like to expand into the international market in about six months to a year.

 

What specific goals and accomplishments do you hope to achieve by the time of your 50th anniversary in five years?

We are currently working on a project full of potential called the Re:Tree Project. The goal of this project is to transform Japan's so-called "concrete jungle" into a landscape dominated by wooden buildings. The overarching vision of AQ Group is to question the conventional way of doing things and to create a richer quality of life.

With this vision in mind, we are aggressively working to expand the construction of mid-rise wooden buildings throughout Japan. At the same time, we have global ambitions: 2x4 construction is the current international standard, but we aim to go beyond that standard by combining the structure and standards of post-and-beam construction and Japan's superior pre-cut technology. This approach has resulted in a building that is more disaster-resistant, insulated, and energy-efficient. This approach results in a cost-effective wood construction method that is disaster-resistant, insulated, and environmentally friendly.

As our company approaches its 45th anniversary, I am 65 years old. My goal for the next five years, until I turn 70, is to create something truly unique, free from common sense, and spread it throughout Japan. And after that, I would like to aim to spread the Re:Tree project around the world.

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