Since 1993, Takeuchi Construction has undertaken approximately 1,600 projects (totalling in excess of 3.8 million square meters), including factories, warehouses and shopping centers throughout Japan. A pioneer in foundation construction, Takeuchi Construction developed the TNF method for low-rise buildings in soft ground areas. “Buildings often don’t need piles so there were demands for construction methods without the use of piles, which are costly and time-consuming to install,” explains company CEO Kinji Takeuchi. “The TNF method is one that maximizes the use of the original ground. In our research, we found that the TNF is also effective in suppressing seismic vibration and liquefaction.”
The Japanese construction industry boomed more than 50 years ago around the time of the 1964 Olympics, and as such today we see a lot of construction needing repair, upkeep and maintenance as opposed to new builds. What is your assessment of Japan’s construction industry, and what needs are coming as the population ages?
The Japanese construction market overall can broadly be divided into three major categories. Firstly, government construction investments, which are the public investment projects. Secondly, private construction investment, which is housing investment, and finally private non-residential construction investment, which is the most important one from our company’s point of view. The situation in the private non-residential construction segment particularly has been escalated by scrap and build activities, which means demolishing existing buildings and building new ones as technologies is making progress, and that’s the reason why this market seems to be most promising for the overall construction business in Japan going forward.
First of all, let's describe the non-residential private construction investment segment in Japan or globally. Target of non-residential investments usually is composed of several kinds of warehouses, factories , or retail stores in which companies provide their products or services directly based on consumer’s demand. It's true that the shrinking population of Japan is one of the biggest social problems, as you pointed out, but the non-residential private construction sector in which we operate is not really affected by that problem. Of course, demographic changes will have something of an effect on the overall construction business in Japan, but non-residential and commercial facilities are more or less safe in that regard, which means our company is more or less protected from it.
You mentioned commercial property as your primary target market. Could you go into detail about who those customers will be, and where you foresee exponential growth in the future? You’ve mentioned warehousing for ecommerce would be a big target market in the future. Could you expand on that a little bit?
We forecasted that customers’ behavior would be changing rapidly in Japan, and we see that the ratio of B to C domestic E-commerce consumption was about 8% back in 2020 and these numbers were increasing on an annual basis so we expected that this trend will continue to increase in the future, so demand for distribution warehouses is expected to increase. Accordingly, we believe that there will be a decrease in the amount of stores in line with an increase in demand for distribution warehouses. As for factories, we’ve seen recent movement of Japanese companies coming back to Japan so we can also see a slight increase in those types of facilities.
You provide varying types of anti-seismic structural methods for construction focusing on foundations. Can you explain to our readers how these methods work and how they're adapted, in particular to the soft soil that we find here in Japan?
First of all, the technologies that we have - both TNF construction method and the T-BAGS seismic base isolation system – have provided amazing results so far. The achievements speak for themselves. 11 years ago there was the Great East Japan Earthquake, followed by several major earthquakes. Coincidentally, the day before this interview there was also a major earthquake with its epicenter in the Tohoku region.
TNF general view
In particular, the Tohoku earthquake 11 years ago caused extensive damage to many buildings, but buildings constructed using the TNF construction method were not severely damaged. In a shopping center, damage to the interior of the building was minimal, with no shelves falling over and goods scattered on the floor, and the shopping center is still in operation. The results have been uniformly excellent throughout Japan and in subsequent earthquakes wherever they have occurred.
Let me explain our TNF and T-BAGS technologies. The TNF construction method is characterized by its simple structure, short construction time, and low cost. Even on soft ground for low-rise buildings, the improved ground formed by the TNF method, without the use of piles, provides stable support for the building and suppresses ground subsidence, known as consolidation. In addition, the method has recently been found to be effective against earthquakes, as it does not impair the seismic absorption capacity inherent in soft ground. The T-BAGS method was developed by the Company following the Great East Japan Earthquake. The T-BAGS seismic isolation method features sandbags stacked into two-layers with sandwiched special sheets which are layed under the floor and foundation. In the case of an earthquake, sandbags suppress the earthquake energy by sliding horizontally. Unlike commonly used rubber seismic isolation devices, T-BAGS, which are made of sand and polypropylene cloth, are durable and do not require maintenance.
General view of T-BAGS seismic base isolation method
So far, we were able to verify the performance of the two methods over a long period encompassing several serious earthquakes all around Japan. It’s important to mention we must understand the characteristics of the ground soil on each construction site such as how much softness or hardness the soil has. Vibration characteristics of earthquakes vary greatly depending on ground conditions. Basically, TNF is a countermeasure method for soft ground, but it can also protect buildings from earthquakes without compromising the natural seismic energy absorption effect of soft ground. On the other hand, on solid ground, active seismic isolators need to be installed, and this is when the introduction of T-BAGS can be effective.
Through numerical analysis can now predict with a high degree of accuracy the behavior of the ground in the event of an earthquake and the vibration-isolation effects of T-BAGS, and we are establishing this method as a design method. The shaking of buildings caused by earthquakes is greatly influenced by local ground conditions, but this design method has enabled us to determine what measures are best suited to each region.
We will be sending several representatives to the 11TH INTERNATIONAL STRESS WAVE CONFERENCE 2022 in the Netherlands in September 2022 to introduce our technology to a larger foreign audience.
You're competing directly against the pile driving foundation method, which is the primary competitor in terms of methodology. Could you explain to us the advantages of the TNF method, and why you think it's a better option for foundations?
The conventional construction method is to use piles in order to support entire iron and concrete structures.
While the pile method is essential for high-rise buildings, it is not always necessary for low-rise buildings of one or two stories, and in Japan, where the geology is complex, it can be difficult, costly and take a very long time to construct.
In addition, during an earthquake, buildings constructed using the pile method may sway significantly as seismic energy from deep underground is transferred to the building via the piles.
Furthermore, when renovating or rebuilding, piles may need to be pulled out of the ground. In such cases, part of the pile sometimes remains in the ground, which is not good for the environment. On the other hand, the TNF method rarely affects water resources or the environment underground, as TNF construction is limited to shallow layers. We can say that the TNF method is more environmentally friendly than the piling method which involves deeper work.
In addition, the TNF method, which only extends to an average depth of 2.3 m to 2.5 m, is easier to dismantle than the piling method, which involves pulling out piles driven to a greater depth.
The dismantled improved ground can be used as good foundation ground for the next construction, reducing the size of the earthwork and foundations. The cementitious solidifiers used in ground improvement emit a lot of CO2 during production, so they are not an environmentally friendly material. But even so, considering that the scope of construction is limited to shallow layers, the ease of dismantling, and the ability to be re-used, the impact is considered to be minimal.
You've been using this method since 1993 and completed more than 1500 projects to date. Which of those projects are you most proud of, either domestically or overseas?
The TNF construction method and T-BAGS system have been used for a commercial building on the grounds of Heian-Jingu Shrine in Kyoto. The Heian-Jingu Shrine is a historically important place with national treasures, and I am proud that the TNF construction method and T-BAGS system was adopted there.
Store on the grounds of Heian Jingu Shrine
What role does collaboration or co-creation play in your business model and are you currently looking for partners either in Japan or overseas to help you overcome the technicalities involved in different regions you wish to operate in?
Foreign employees are very important because they are the bridge between Japanese companies and the rest of the world. We have an employee from Iran, which has many earthquake disasters like Japan. Iran is going through a lot of geopolitical issues at the moment, but we still aim to recruit people from Iran and later expect them to introduce and spread our technology and skills in Iran.
I think that we would like to go to the United States at some point as well because the United States is quite a promising market. In the US, where warehouses and commercial buildings are often very simple, low-rise and huge, the TNF construction method is a perfect fit. However, it is likely that not much is known about ground improvement technology and methods such as ours, so our foray could be beneficial for both parties.
In addition, Southeast Asian countries, particularly Indonesia, are prone to earthquakes, so ground improvement is beneficial in these regions. We have already expanded into Vietnam and introduced the TNF method to local construction companies. They are also looking at alternative methods to the high-cost piling method.
Could you please share with us the current focus of your research and product development strategy?
We are developing detached houses with high earthquake resistance and low energy costs. In Japan, frame construction, as typified by wooden structures, has traditionally been used, whereas wall construction, such as stone and block, has been used more frequently in Europe, and each has its advantages and disadvantages. The earthquake resistance walls are placed between the columns to improve the earthquake resistance of the frame structure, but we separate the walls from the frame and make it a double structure with the frame, so that the flexibility of the frame structure is not compromised and the earthquake resistance and thermal insulation effects of the wall structure can be utilized, and that is what we aim to develop.
We have a concept called '250-year homes'. The double-layer construction of the house means that the timber is not exposed to the outside air and does not corrode, meaning that the house will not need to be rebuilt for 250 years. By collaborating tradition with the latest technology, these houses reduce the environmental impact as much as possible and protect the owner's property for a long time.
You’ve said that you’re interested in entering the US and Indonesian markets. What kind of strategy will you employ to achieve this? Would you be interested in joint ventures and M&As, or new sales offices or perhaps more foreign staff from those countries?
Our strategy depends on what possibilities the local agencies can show us. As it is difficult for us to expand abroad on our own, we could consider some form of franchise with local companies. However, TNF and T-BAGS cannot be imported from Japan and sold immediately, like imported products. In each design method and construction, it is necessary to cooperate with companies to meet considerable technical requirements.
A certain period of training is required to ensure that the technology is properly understood, from design to construction. If our personnel abroad do not understand the basic knowledge of what our construction methods should be like, we cannot expand into any country. For this reason, we currently employ personnel from overseas, train them in Japan and have them pass on their skills and know-how to their home countries while communicating with local people.
When deploying our construction methods in a particular region, it is necessary to determine which sectors and regions are in high demand, and to consider country-specific and region-specific approaches, taking into account the characteristics of the ground in the region, the size of buildings in the sectors in high demand, and the availability of construction materials. In the future, if we can have partner companies or representative offices in the USA and Indonesia, we would like to carry out these surveys and determine our approach.
Another important factor when considering overseas expansion is whether the country is a society that flexibly adopts new technologies. In Japan, convention is often emphasised when it comes to construction, and the introduction of unprecedented construction methods and technologies is sometimes discouraged. It is also not easy to obtain certification for construction methods.
On the other hand, many emerging countries are open to the introduction of foreign technology, and local companies are willing to learn technology without being bound by convention, so the hurdles to entry are not as high as in Japan.
Let's say we come back to interview you again in three years' time for your company’s 35th anniversary. What would you like to tell us about your goals and dreams for the company in that timeframe, and what would you like to have achieved by then?
It may be better if I get an interview with you again when I’m at the point of retiring because I don’t think about it in terms of short time periods like a few years. We’d like to create a kind of ‘circle of happiness’ for the company, with no need to attach ourselves to any existing technology at all, because time flies and new markets and needs come along. New technologies appear, so we don’t want to focus on any one particular technology. We’re constantly developing new and improved methods. For example, we’re currently developing TNF 2.0 but also studying computation theory simultaneously for the next generations of TNF, including 3.0.
We are aiming for TNF 3.0 to be the technology that can support buildings comprised of five or six floors while the current TNF can support the buildings of two or three floors.
I provided all the original ideas belonging to the construction method of our company, but the improvement and deployment of our technologies will fall on the shoulders of the next generation of executives of my company. It’s not enough just to pass on the original idea to the next generation. The employees of the company have to develop their own approaches to innovate.
For example, if I transfer that idea to three people and then they go on to tell others, the idea may eventually become diluted but it may also be augmented. It's important to have people beside you who share the same values and maybe they’ll be the ones who will come up with something new. Therefore it's important to have a good human resources around you to move steadily into the future.