True or False: During the Japan Bubble, one sky scraper in Tokyo was worth more than the entire state of california?

Question

I have heard a rather outlandish claim that during the peak of the real estate bubble in Japan (I think that was in the 70's and 80's), one sky scraper in Tokyo was worth more than the entire state of California! Seeing as California's economy is larger than even some entire nations, I couldn't wrap my head around how high the bubble in Japan was. Then again, it reminded me of the Dutch Tulip crisis, and we all know how expensive those flowers were... so maybe the Tokyo skyscraper claim was legit? I'm just not sure.

Question: Is this statement true? I wonder if there is any data that is readily accessible; I'd like to plot it on a line graph. Also, if the statement is true, it would be neat to know how long it lasted. Was 1 Tokyo sky scraper out valuing California a momentary apex before it all imploded, or was this the way it was for an extended period of time (months, years)?

Answer 1

Brian is right. The claim was that, if you took the cost per square meter of land area in Tokyo based on market rates, the Imperial Gardens in Tokyo were worth more than California.

Source: http://articles.chicagotribune.com/1989-11-19/business/8903110641_1_land-prices-national-land-agency-rockefeller-center

Obviously, this is a classic example of a fallacy that arises from extrapolation— if that additional land area had been made available for sale, it would have significantly increased supply and caused prices to drop accordingly.

Answer 2

Clearly false.

One of the largest skyscrappers in Tokyo has an area of 2,630,300 square feets. Estimating value per square feet to be \$5000, its value is less than $15 billion.

The houses in Los Angles alone were worth an estimated $2.5 trillion this year. Assuming that both estimates are off by a factor of 10, and the skyscrapper was once worth ten times as much while the LA homes were worth ten times less, the skyscrapper's value would be still less. And the comparison was just with the value of LA homes, not the entire state of California.

@BrianRomanchuk's version may be much closer to the truth. To be honest I still find it hard to believe. Perhaps they measured net worth of California.