(Corrects time period of real estate index return in second paragraph of story published on Oct. 9.)

Oct. 10 (Bloomberg) -- Shares in Simplex Investment Advisors Inc., which manages about 200 properties in Japan, rose by their daily limit after Goldman Sachs Group Inc. offered a 43 percent premium in a takeover bid, sending real estate stocks higher.

Simplex rose 30,000 yen, or 20 percent, to 180,000 yen in Tokyo. The Topix Real Estate Index rose as much as 3.1 percent and is up 23 percent in the past month, the best performance among 33 industry groups.

``The Goldman offer has put the focus back on the real estate market,'' said Masahiro Mochizuki, an analyst at Credit Suisse in Tokyo. ``Investors expect more mergers and acquisitions in the sector with shares still cheap relative to the value of properties held.''

Investment banks, real estate investment trusts and private equity firms are acquiring assets in the world's second-biggest economy after Japanese property prices rose last year for the first time since 1991. New York-based Goldman spent 2 trillion yen since 1998 on office buildings, golf courses and resorts in the nation while Morgan Stanley, the biggest owner of real estate among Wall Street firms, bought offices and hotels.

K.K. DaVinci Advisors, which runs Japan's biggest real estate investment fund, rose 11,000 yen, or 10.7 percent, to 114,000 yen, while Kenedix Inc., a Japanese real estate investment company, rose 6.5 percent to 245,000 yen.

Goldman Reassures

Goldman offered on Oct. 5 to buy Simplex, which focuses on small- to medium-sized office properties mainly in Japan's biggest cities, for 215,000 yen per share, or 124.7 billion yen ($1.1 billion). Nikko Cordial Corp., Japan's third-largest securities firm, agreed to sell its 42.5 percent stake to Goldman's joint venture with New York-based Aetos Capital LLC.

Regulatory concerns had weighed on real estate stocks after a new law raised the prospect that some asset managers would have to hire more compliance staff and face increased legal costs, said Mark Brown, a real estate analyst at Japaninvest K.K., a Tokyo-based equity research firm.

``The Goldman deal shows how even if this is a problem, there are corporate investors out there who have the resources to pick up the pieces,'' he said.

The Financial Instruments and Exchange Law, which took effect on Sept. 30, tightened regulation across Japan's financial industry as part of the government's drive to offer greater investor protection after several scandals.

Property Gains

Japan's property boom has gathered strength. Nationwide commercial land prices rose in the 12 months ended in June for the first time in 16 years as the property market continued to rebound, the Ministry of Land, Infrastructure and Transport said last month.

Land prices in Japan's three largest metropolitan areas gained for a second straight year, rising 5.1 percent on average for the 12 months ended June 30 from an increase of 0.9 percent a year earlier.

Commercial land prices surged 24 percent for the year in central Tokyo, 14 percent in Osaka and 18 percent in Nagoya.

To contact the reporters on this story: Takahiko Hyuga in Tokyo at thyuga@bloomberg.net; Kathleen Chu in Tokyo at kchu2@bloomberg.net.

Last Updated: October 9, 2007 20:57 EDT