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Japan’s existing National Stadium sits in a large sports park in Tokyo's Shinjuku ward, a busy suburb of the capital city. The existing venue was opened in 1958 for that year’s Asian Games, and went on to be the centerpiece of the 1964 Summer Olympic Games. 

At the time it was a world-class stadium, but sporting venues have come a long way in the intervening 50 years. Today the National Stadium’s shallow bowl, open-top design and relatively low capacity of just over 54,000 people, only 48,000 of which are seated, make it something of an out-dated facility. Recognizing this, the facility’s owner, quasi-governmental organization Japan Sport Council (JSC), has been looking at some time to refurbish or replace the stadium. This was given a certain impetus by the decision in July 2009 by the International Rugby Board (IRB) to name Japan as the host of the 2019 Rugby World Cup.

According to Yoshitaka Takasaki, JSC’s divisional manager for its general affairs department, and the man responsible for the administrative aspects of planning and constructing the new Narional Stadium. the decision to build a new facility was taken in early 2012. At the time, this was purely in light of the 2019 Rugby World Cup, but the project received another boost in September 2013, when Tokyo won the competition to host the 2020 Summer Olympic Games.

Planned Iconic New National Stadium, Tokyo, Japan

There can be little doubt about JSC’s ambitions for the quality of the venue it wants to build. As the organization's president, Ichiro Kono said, "As a national project conducted once every  half century, we aim to build a stadium  that will be recognized as a global model.”  Mr Takasaki said the plan was to build  a venue that would be suitable for a range of events — not just sports like rugby, athletics and football, but concerts as well. A closeable roof was another requirement to allow the stadium to be used in all weathers and in terms of capacity, the International Olympic Committee (IOC) requires the main athletics stadiums to seat 80,000 people, so that was a critical requirement too.

One of the problems with combined athletics and ball sports stadiums is that the presence of a running track can leave spectators too far from the action when it comes to a rugby or football match. To get around this problem, JSC envisages a design where a moveable lower tier of seats can be pushed out over the track to put fans much closer to the pitch.
 

Between the decision to build a new stadium and the announcement of Tokyo's successful bid for the 2020 Olympics, JSC launched an architectural competition to design the new venue. As with every aspect of this project, this was done on a tight timescale, with the July 2012 competition launch carrying a deadline of November 25 that year.

Despite the challenging timetable, there was no shortage of architects entering with their visions for what would clearly be a high-profile and iconic project. The winner was UK-based Zaha Hadid Architects. No doubt spurred by the news of Tokyo’s winning bid for the 2020 Olympics in September 2012. The other cities in contention up to that point had been Madrid, Spain and Istanbul, Turkey. 

Stadium Design

If Beijing had the Bird's Nest stadium for the 2008 games, Tokyo's centerpiece venue stands a good chance of being nick named ‘The Cycling Helmet.’ The design features series of shallow arches rising from outside the bowl of the stadium, with translucent materials filling the voids between them to create the fixed and open-able sections of the roof. According to Mr Takasaki, the design is currently being finalised ahead of the start of work on site later this year. The first element of the project will be the demolition of the existing national stadium and the contract for this, valued at around JPY 6.7 billion (US$ 65 million) was due to be put out to tender.

The existing stadium is a substantial structure that escaped the 2011 earthquake unscathed, so its demolition looks set to be a significant project in its own right. It is a five storey structure built predominately from reinforced concrete. The total area of the stadium, including track and in-field is 71,707 sq.m, with the stadium structure itself having a 33,716 sq.m footprint. 

Mr Takasaki said the demolition portion of the project was scheduled for 16 months, with a start date in July this year. That work would carry on until October 2015, with the 42-month construction phase due to follow-on immediately.

With the start of the construction portion of the scheme still well over a year away, JSC is working to finalize the designs. Mr Takasaki said the main consideration was to decide between the design as originally published or a minimized version which would be cheaper and quicker to build, but which would leave out some elements.

If everything runs to schedule, the planned timescale would see the stadium completed in February 2019, some six to seven months ahead of the Rugby World Cup kick-off on September 6 thar year. The opening of the 2020 Summer Olympics is due to take place on July 24 the following year, some 17 months after completion of the project. 

 

According to JSC, the total budget for the project is JPY 169.2 billion (US$ 1.64 billion). The bulk of this some JPY 138.8 billion (US$ 1.3 billion) is of course for the construction of the new stadium. The remaining JPY 30.4 billion (US$ 295 million) breaks down inro the JPY 6.7 billion (US$ 65 million) for the demolition work and JPY 23.7 billion (US$ 230 million) for various environmental and development work associated with the project.

Funding will come from a combination of national Government funds, Tokyo’s City budget and a contribution from Toto, the Japanese national sports lottery. Mr Takasaki said the size of the individual contributions were yet to be decided but added that the project was effectively underwritten by the national government. One of the biggest problems associated with the project is, according to Mr Takasaki the planning and flow of materials. Tokyo is a famously large dense and sprawling city and the logistical considerations are not helped by the fact that plans need to be coordinated with the city government as well as the three suburban wards that border on the stadium site. It all makes for a formidable challenge, but as Mr Takasaki said,

So far. so good.

Emerging market economies have been under pressure in recent months, and India is among those most affected. These economics boomed for much of the past decade with easy monetary policy globally, the commodities super-cycle and rapid globalization of trade. In many cases, there was additional fiscal stimulus to counteract the global recession.

However, while the share of global GDP accounted for by imports increased from just under 20% in 1995 to over 30% in 2011. It has remained at that level into 2014. This stagnation has limited the export opportunities that have been crucial to emerging markets such as India.

 

Countries such as India also face an additional challenge - when financial returns were low in the US and Europe, investors looked to emerging markets with their potentially high returns despite higher financial risk. With the US in economic recovery and Europe stabilizing, developed economies offer higher potential. as risk has grown in India and other markets. The result has been limiring the flow of foreign direct investment on which India relies.

Most importantly, lndia like many emerging markets. failed to engage in market reforms when the opportunity afforded itself. As a result financial incentives working against India and the unattractive business environment is reinforcing the negative trend.

Worst is Over
 
The worst for India's economy may be over, but the recovery will be shallow and protracted with weakness well into the next fiscal year at least. The main engines of growth historically, investment and private consumption - remain fundamentally weak, inevitably dragging down industrial production, manufacturing and construction.

Infrastructure spending has been a bright spot - however, the government budget deficit will limit additional fiscal boosts to growth. The outcome of general elections in May should reduce political uncertainty, opening up prospects for higher investment and growth late in 2014.

Although uncertain, India's medium and long term growth prospects are still favorable, as expected reforms with a new government confer significant gains in supply-side efficiency. Boosting investment is crirical to India’s recovery. Fixed investment growth has fallen to +2.8% per year compared with double digit rates in the mid 2000’s, partially due to stalled reform.

The government did manage to clear 36 big ticket investment projects late last year worth nearly US$ 27 billion, but the financing and implementation of these projects may still prove to be difficult given deteriorating public finances and rising banking sector risks.
 
  Favorable Demographics

On the positive side, India is blessed with favourable demographics and abundanr labour, strong export potential, and growing contributions from the service and construction sectors. Rapid urbanisation rates will also act as an important force of change in the long-term.

The construction outlook reflects the current realities in lndia, while building on the expectation for reform. In particular, the forecast growth rates are typically a full percentage point below what was projected last year(2013), given what will be tepid GDP growth in the near term.

Also, forecast growth is back-loaded, assuming that reforms materialise after the election and take time to work through to the construction economy. For example, construction of non residential structures will average compound growth of +7.9% over the next five years, but growth for the next three years will average +6.2.

The average over the following years will be + 8.2%. To the extent that reforms fail to materialise, medium to long term growth will lose considerably - potentially shaving two percentage points from potential growth. The forecast for the residential sector is relatively weak. Urbanisation, popularion growth and an emerging middle class contribute to growth, but consumer confidence remains weak and higher interest rates are particularly costly to this segment. Unlike China and Brazil, India offers limited public spending on housing, and private demand will be limited.

Office construction has been strong for the past five years, driven by India’s technical services industry. Demand from this sector will wane over the forecast, but anticipated growth in financial and business services will drive continued growth. The forecast for growth in industrial structures does hinge upon market reforms to boost India's manufacturing industries and export competitiveness. Reforms have already been partially implemented for some commercial categories, notably retail trade.

Infrastructure has been the strongest performing segment over the past five years, and it will remain so over the forecast. India absolutely has to invest in additional infrastructure in order to meet even its reduced economic outlook.

The forecast does assume some structural reform in order to attract private capital into public - private partnerships. India has proven that this can work for airports - the next step is to expand that success to roads, railways and electrical generation, transmission and distribution.


Potential
 
While the construction outlook for India has diminished with weakness in Europe and recovery in North America, it still offers significant potential. The next two years will feature slower construction than we have come to expect from India, bur still strong by global standards. The continued emergence of lndia's economy is clear, and the need for new and upgraded facilities must be met. For India to realize its potential, the education system requires significant investment, and the expectation is that the new government will begin to address this.

The challenge for India is to overcome the ‘license raj’ to free up its abundant resources for economic growth. If the new government can succeed with these measures, the construction outlook could be quite attractive.