The market for luxury apartments in Tokyo has seen a rapid improvement and is at a point where some are comparing it to the mini bubble that occurred prior to the Lehman collapse in 2008.
In June 2014, Mori’s latest high-rise project - Toranomon Hills - was completed. The 52-storey building contains office space, the Andaz Hotel and 172 apartments. Approximately 70 of the apartments were offered for sale with an average price of around 3,000,0000 Yen/sqm, making this the most expensive apartment building in Japan. The sales office was inundated with inquiries prior to sale and lucky apartment buyers were selected by a raffle-type system. All apartments sold out.
Although it is difficult to say that the new apartment market is doing well across the board, the number of luxury developments seeing same-day sellouts is increasing. The share of new apartments priced over 60 million Yen is also rising. In 2013, they accounted for 19.8% of the new apartment supply, up 6.7 points from 2000. The contract rate for new apartments in October hit a five year low of 63.3% in greater Tokyo, but the contract rate for new apartments priced over 100 million Yen has remained over 70% for the past five months. For new apartments in the 200 ~ 300 million Yen range, the contract rate has been between 75% ~ 100%.
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