For Sale: America

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American real estate agents love the trend: by some estimates, the Japanese have single-handedly boosted the selling prices of prime Manhattan real estate 10% to 15%, to roughly $500 per sq. ft. Those prices are still a bargain compared with costs in Tokyo, where office towers sell for an astronomical $20,000 or more per sq. ft. -- on those rare occasions when anything comes up for sale. Says Shigeru Kobayashi, owner of Japan's multibillion-dollar Shuwa real estate empire: "Bond buyers are holding paper, but I have buildings and land. That's the future." Kobayashi's son Takashi, head of the family firm's U.S. subsidiary, controls 26 U.S. buildings worth some $2 billion. Among them: the ARCO Plaza in Los Angeles (bought for $620 million last September) and the ABC network headquarters in Manhattan ($175 million in October). Says the senior Kobayashi: "America is where greatness is."

Japanese bargain shoppers increasingly covet neglected American gambling casinos. Last April, Ginji Yasuda, a Korean-born Japanese, reopened the 1,100- room Aladdin Hotel in Las Vegas after buying the ailing complex for $54 million and spending $30 million more to restore its glitzy decor. He plans to shuttle customers from Japan in a posh jet equipped with sleeping cabins. Says Yasuda: "You have a lot of dreams still available in this country that you don't have in Japan."

Tokyo Billionaire Masao Nangaku, 68, had an expensive fantasy last month, when he outbid five U.S. companies for Las Vegas' struggling Dunes Hotel. The winning price: $157.7 million. Nangaku plans to virtually double the size of the hotel, to 2,200 rooms. Nangaku says he has wanted to buy a casino in Las Vegas for years. Backed by a vast recreation empire (bowling alleys, golf courses, hotels), he apparently had little trouble lining up the financing for the Dunes purchase through his Tokyo bankers. Boasts an aide: "Our assets are worth far more than the price of a Las Vegas hotel."

One corporate arena in which Japan's huge bankroll is prompting intense jitters is the U.S. financial-services industry. Tokyo's largest banks and investment firms, which already eclipse American companies like Citicorp (assets: $196 billion) and Merrill Lynch ($53 billion), openly aim to grab a large share of the U.S. financial marketplace. They have established a major beachhead in California, where four of the top ten banks are now Japanese owned: California First Bank, Sanwa Bank, Bank of California and Sumitomo Bank of California. On Wall Street, Japan's Sumitomo Bank shelled out $500 million for a 12.5% share of profits in the Goldman, Sachs investment-banking firm, while Nippon Life Insurance paid $538 million for a 13% slice of Shearson Lehman.

The Japanese have largely shied away from takeovers of major U.S. industrial corporations, at least partly in fear of a public relations backlash. "We are worried about investment friction now. It may get serious," says Hiroki Sakamoto, a senior official of the Japan External Trade Organization. But last month Dainippon Ink & Chemicals won a long and bitter battle to take over New York's Reichhold Chemicals, a maker of specialty polymers. The price: $540 million.