Small Concession Latest Trends [2026 Edition] — One Year of the Platform: Achievements and Challenges
A look back at the first year of the Small Concession Platform (December 2024 – December 2025). Membership growth from 617 to 903 to 1,042, an interim report on expert dispatch to seven municipalities, institutional challenges, and the outlook for 2026 and beyond — written accessibly for newcomers.
TL;DR
- The Small Concession Platform reached 1,042 members within one year of its December 2024 launch, beginning to function as a productive public-private-academic-financial collaboration hub
- Expert dispatches are underway for seven selected municipalities (FY2026), targeting four historic buildings, two former schools, and one former government office
- Three institutional challenges remain persistent: low commercial viability, shortage of capable private operators, and difficulty designing long-term concession schemes
Platform's First Year in Review
Key activities and outcomes from December 2024 to December 2025: seminars, case studies, matching, and more
The "Small Concession Platform" (hereafter: Platform or PF) — the central infrastructure supporting the spread of Small Concession — was established on December 16, 2024 by the Ministry of Land, Infrastructure, Transport and Tourism. In December 2025, it reached its first anniversary.
Over its first year, the Platform's primary activities have centered on three areas.
Activity 1: Information Dissemination and Awareness
Spreading awareness of the Small Concession concept, policy framework, and practical cases was the dominant activity in the earliest phase.
- Seminars and webinars: More than 10 online and in-person seminars were held in the first year, drawing 200–400 participants each session, with presentations from policy officials, practitioners, and researchers
- Case study reports and guideline publications: Detailed reports on pioneering cases (Manazuru Town, Anjo City, Himeji City, Nara City, etc.) were progressively published on the Platform website
- Newsletter distribution: A member-facing newsletter covering policy updates, new cases, and events was distributed two to three times per month
Activity 2: Facilitating Public-Private Matching
The Platform's forum function enabled progress in public-private matching.
- Online exchange forum: A bidirectional forum began functioning in which municipal officials post case information ("we'd like to activate this facility"), and private businesses respond or make inquiries
- Working Groups (WGs): Theme-based WGs were established for topics such as historic building activation, former school reuse, and public land development, creating venues for participants to voluntarily share cases and discuss challenges
- Individual matching consultations: A small number of individual matching consultations per month, facilitated by MLIT staff, have also been conducted
Activity 3: Implementing the Expert Dispatch Program
The "Small Concession Formation Promotion Project," launched simultaneously with the Platform, has established a framework for dispatching experts to municipalities to support project development. Seven municipalities were selected for FY2026 and expert-assisted project development is currently underway (details below).
Membership Growth
The three-stage progression: 617 → 903 → 1,042. Breakdown and characteristics of membership growth
The Three-Stage Progression: 617 → 903 → 1,042
Platform membership has grown steadily from 617 at launch (December 12, 2024), to 903 after two months (February 10, 2025), and 1,042 after five months (May 14, 2025).Detailed progression:
| Date | Members | Net Increase | Monthly Average Increase |
|---|---|---|---|
| December 12, 2024 (launch) | 617 | — | — |
| February 10, 2025 (2 months) | 903 | +286 | approx. 143/month |
| May 14, 2025 (5 months) | 1,042 | +139 | approx. 46/month |
The rapid early growth reflected a surge of initial awareness, which has since stabilized to a pace of roughly 40–50 new members per month. This trajectory can be assessed as healthy growth — "not ending as a passing trend, but continuing to attract participants."
Notable Characteristics of Membership Composition
The February 2025 breakdown shows: 390 private businesses, 263 individuals, 220 local governments, 36 financial institutions, 21 government ministries, and 13 universities — growing to 1,042 by May 2025 with increases concentrated among private and individual members.
Notable trends:
- Near-equal ratio of private businesses and municipalities: Typical government-led information platforms tend to underrepresent government participants, but this Platform has strong municipal engagement
- High individual participation: Individuals making up roughly 27% of members — architects, consultants, NPO staff, researchers — represent the "intermediary operators" who exist at the boundary between public and private. The critical talent for advancing Small Concession is beginning to gather here
- Financial institution participation: The 40 members from regional banks, credit unions, and policy finance institutions indicates that a support structure for project financing is forming
Interim Report: Seven Municipalities with Expert Dispatch
Overview of the Seven Selected Municipalities
For FY2026, seven municipalities were selected nationwide for the Small Concession Formation Promotion Project, receiving expert dispatches (PPP/PFI consultants, architects, financial specialists, etc.) subsidized by national funds.
Target facilities and locations by type:
- Historic buildings and traditional townhouses (4 cases): Manazuru Town (Kanagawa), Anjo City (Aichi), Himeji City (Hyogo), Nara City (Nara)
- Former schools (2 cases): Two smaller regional municipalities (names based on the published selection announcement)
- Former government office (1 case): One local municipality
The fact that four of seven cases involve historic buildings and traditional townhouses reflects the high affinity between Small Concession's characteristics (small scale, leveraging local resources, tourism linkage) and historic building activation.
→ For more on historic buildings × Small Concession, see Historic Buildings and Small Concession.
Key Points from the Interim Report
As of March 2026, approximately six to nine months into expert dispatch, progress at each municipality can be summarized as follows.
Common challenges across the four historic building cases:
- Securing seismic retrofit costs: Seismic retrofitting of historic buildings involves complex decisions about cultural heritage compatibility and construction methods, and costs may exceed what private operators can reasonably absorb. Experts are supporting the assembly of grant combinations (Agency for Cultural Affairs subsidies, Local Revitalization grants, etc.)
- Identifying capable operators: The pool of private businesses with the skills to renovate and operate historic buildings is small; market sounding often yields only one to three respondents
- Revenue model design: Experts are working alongside municipalities to design models combining accommodation, dining, and experiential programs to achieve monthly revenues of ¥1M–¥3M
Challenges for the two former school cases:
- Facility deterioration tends to be more severe than in historic buildings, and cost estimation for renovation is the primary current focus
- Low surrounding population density makes it difficult to design credible visitor attraction plans
- Some cases are considering a transition from interim operation by municipalities or NPOs to a full concession structure
Notable point for the former government office case:
- Former government offices often have large total floor areas, requiring creative approaches to keep the project within the Small Concession threshold (under ¥1 billion)
- A mixed-use approach (offices, co-working spaces, dining, residential) is under consideration to maintain viability while controlling project costs
Institutional Challenges
The three challenges — viability, operator availability, and long-term scheme design — and the directions MLIT is taking in response
Challenge 1: Low Commercial Viability
The public facilities targeted by Small Concession are often small-scale projects under ¥1 billion in project cost. At this scale, it is frequently difficult for private operators to generate adequate returns while also covering facility renovation and long-term maintenance obligations.
For facilities that cannot reach breakeven on their own — former schools in poorly located areas, underused former facilities — individual private project development is not feasible. Combining grants and subsidies, or bundling multiple facilities into a package, becomes necessary.
Policy direction: MLIT is considering developing and publishing a "project viability assessment tool" that would allow municipalities to estimate revenue prospects before committing to project development.
Challenge 2: Shortage of Capable Private Operators
There is an absolute shortage of private businesses capable of designing and implementing small-scale PPP/PFI. In rural areas in particular, specialized PPP/PFI consultants, architects, and project developers are scarce, and municipalities often do not know who to turn to for guidance.
Policy direction: Discovery and development of capable private businesses through PF working groups and exchange forums is progressing, but the urgency is shifting from "increasing numbers" to "ensuring quality." Continued expansion of the expert dispatch program is needed.
Challenge 3: Difficulty Designing Long-Term Concession Schemes
Concession arrangements are fundamentally premised on long-term operation rights (15–20 years or more), but municipalities often face a psychological barrier to committing to long-term private sector use of small public facilities. The cost of explaining such arrangements to assembly members and residents is also substantial.
Additionally, the risk of operator withdrawal midway through a long-term contract and concerns about continuity as municipal staff rotate are cited as ongoing worries among municipalities.
Policy direction: MLIT is progressing in developing and publishing "standard Small Concession contract templates," and standardizing contract design is expected to help address these challenges.
Outlook
Expected expansion of Small Concession after 2026, integration with Park-PFI, and the path toward institutional maturity
Three Expected Developments After 2026
Development 1: Increase in completed projects (from quantity to quality)
If the Platform's first year was a "raising awareness" phase, 2026 onward is expected to be a phase of "actual project completion." Completion of projects in the seven municipalities with expert dispatch (projected for 2026–2027) will serve as pioneer cases and become reference models for the next wave of municipalities seeking to develop projects.
Development 2: Strengthened integration with Park-PFI
The number of cases combining Park-PFI and Small Concession for integrated activation of entire public land assets is expected to increase. Using Small Concession to activate former schools or facilities adjacent to parks while developing the park through Park-PFI represents one of the most practically realistic solutions for public land utilization in regional and small municipalities.
Development 3: Institutional maturity and self-sustaining operation
Having passed through an initial phase of MLIT-led promotion, the goal for the Platform from 2027 onward is to become an information infrastructure that can "operate independently." A state in which matching and project development between members progresses without central government facilitation will represent the moment when Small Concession adoption has become genuinely self-sustaining.
The Minimal First Action for Newcomers
For those first encountering Small Concession, the smallest immediately available action is free registration with the Platform.
- Visit the Small Concession Platform
- Complete free registration in 5 minutes via Microsoft Forms (no specific organizational status required)
- Catch up on the latest information through the exchange forum and newsletter
→ For detailed guidance on using the Platform, see The Small Concession Platform — Benefits of Registration and How to Use It.
→ For a general introduction to the system, The Complete Guide to Small Concession is the ideal starting point.
References
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