MUFG's Trust Division to Tokenize $681M Osaka Tower for Retail Investors

Mitsubishi UFJ Trust and Banking, the trust division of Japan's largest bank MUFG, has acquired a high-rise building in Osaka City for more than 100 billion yen ($681 million) with plans to create digital securities for retail and institutional investors.

The bank intends to tokenize the real estate asset and offer it to retail investors through digital securities, while also selling portions to life insurers as a private real estate investment trust (REIT), according to reporting by the Nikkei .

The move positions MUFG Trust as a direct competitor in Japan's emerging tokenized real estate market, where digital bonds dominate European tokenization efforts but real estate tokens lead Japanese issuances.

The tokenization approach allows MUFG Trust to offer fractional ownership of high-value real estate assets to retail investors who would otherwise lack access to such investments, while institutional buyers can participate through traditional REIT structures.

Japan's digital securities market remains nascent despite growing activity. Since the first offering launched in 2021, the country has seen 63 digital securities issuances totaling 194 billion yen ($1.3 billion). Real estate tokens account for roughly 80% of issuances, with bonds comprising the remainder, Ledger Insights reported .

The secondary market reflects the early-stage nature of tokenized real estate in Japan. The Osaka Digital Exchange's START marketplace lists six real estate tokens with modest monthly trading volume of just 23 million yen ($157,000).

MUFG Trust's entry creates competitive dynamics with existing market players. Mitsui Digital Asset Management has been particularly active through its Alterna platform, which targets retail investors directly. The company has completed an estimated 14 of its 16 total issuances through the Alterna platform.

Until recently, Mitsui partnered with MUFG Trust for the required trust structure to tokenize real estate assets. However, seeking faster token issuance capabilities, Mitsui established its own Alterna Trust structure last month, effectively ending the direct partnership.

Despite the apparent competition, both companies maintain connections through Progmat, MUFG's digital securities platform. Although MUFG spun out Progmat as a separate venture, the bank retains a 42% stake. Mitsui recently signed an agreement to continue using the platform for most of its security token operations.