Builder Dia Kensetsu files for bankruptcy

Kyodo News

Condominium builder Dia Kensetsu Co. filed for bankruptcy protection Friday under the fast-track corporate rehabilitation law as the recession continues to crush the real estate market.

The Tokyo District Court authorized the application and ordered that Dia’s assets be protected, the Tokyo-based company said.

Dia, known for the Dia Palace brand of condos, folded with some ¥30 billion in liabilities.

Dia is the 34th publicly listed company in Japan that has gone bust this year, a record high, according to private credit research agency Teikoku Databank Ltd.

Founded in 1976, Dia began having financial difficulties with nonperforming assets after the bubble economy imploded in the early ’90s. It rehabilitated with support from the government-backed Industrial Revitalization Corp. of Japan, which was set up in 2003.

But Dia has been hit hard from the fallout from the U.S. financial crisis, leading to a record-breaking decline in condo sales in the Tokyo metropolitan area in November.

There are some 2,000 Dia Palace condos across Japan.

Dia is listed on the second section of the Tokyo Stock Exchange, which said its shares will be delisted Jan. 20.