Office rents in central Tokyo continue to climb with a 6.93% year-on-year increase reported in September. This is the 69th month in a row to see a year-on-year increase. Meanwhile, vacancy rates remain low with an average of 1.64%, equal to the recent historic low seen in May. The vacancy rate excluding new construction was 1.56% last month, down 0.7 points from last year.

Chiyoda Ward, which includes the prestigious Marunouchi and Otemachi business district, had an average vacancy rate of 1.28%, down 0.99 points from last year and the lowest across all five wards.

Shibuya Ward, which is seeing a large redevelopment around the Shibuya Station area, had a vacancy rate of 1.51% in September. Average monthly office rents in Shibuya were the highest in central Tokyo at 24,607 Yen per Tsubo (approx. 7,445 Yen/sqm or US$68/sq.ft).

Vacancy rates are expected to remain low for the near future as new construction coming online towards the end of the year is already fully leased.

Source: Miki Shoji, October 10, 2019.

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