Funds Hope to Cash In on Japanese Cuisine

The world’s appetite for Japanese tuna, Wagyu beef, and other delicacies prized in restaurants as far away as New York and London is behind an unusual investment trend in Japan. Institutional investors and regional banks, chasing returns they hope will be as high as 7 percent, have poured at least 23 billion yen ($281 million) into about a dozen funds that invest in Japanese farms and fish ponds.

Four of these food industry funds are managed by former Citigroup banker Daisuke Mori, who has pooled 10 billion yen from regional banks and institutional investors to put into projects including tuna farming, most of them on the southern island of Kyushu, far from the radiation contamination caused by last year’s earthquake and tsunami. “Food is the one area that has a big investment potential,” says Mori, 44, president of Dogan Investments in Fukuoka City. “Locally farmed tuna, pork, and beef on Kyushu island should get a stronger connection with the big market outside of Japan.” Ryohei Hayashi, a senior Dogan manager, says the latest of its funds, which are closed to individual investors, is targeting a 7 percent return this year.