A recent use-change will see some luxury rental apartments added to Japan’s tallest tower-to-be. On January 8, the Nikkei Shimbun newspaper reported that the 390-meter tall Torch Tower, on the northern side of Tokyo Station, will have around 50 apartments with monthly rents ranging from 1 ~ 5 million Yen (approx. US$8,650 ~ $43,200). The largest apartment will be in the 400 sqm (4,300 sq.ft) range.
This is an interesting shift as development sites in these highly-commercial districts have almost entirely been dedicated to commercial buildings, with almost zero residential offerings. The demand to develop office and hotel space, pre-pandemic, had been limiting residential supply in many of the prime areas in central Tokyo. While the commercial sector has been hit with rising vacancy rates as the pandemic surges on, the residential sector has been extremely resilient and experiencing strong demand.
The Japan Real Estate Institute estimates that the average rent for a luxury apartment in London is about 2.2 times higher than a comparable one in Tokyo’s Minato ward. New York is estimated to be about 1.9 times as high. An apartment with a monthly rent of 5 million Yen would not come close to the highs seen in some of the world’s top cities, leading Mitsubishi to feel confident in sourcing residential tenants for these apartments.
Torch Tower is a trillion Yen project led by Mitsubishi Estate on a 3.1 hectare site near Tokyo Station. Construction is expected to start in 2023 with completion in 2027. The 212-meter tall Tokiwabashi Tower, also part of the project, was completed last year. The hotel and event hall floors of the 63-story Torch Tower will be acquired by Mitsubishi Estate and Tokyo Century Corporation for 56 billion Yen.
Currently, the most expensive rental apartments in Tokyo are:
- Homat Viscount, 5 Bedrooms: 3,300,000 Yen/month
- Roppongi Hills Residence, 4 Bedrooms: 3,220,000 Yen/month
- Toranomon Hills Residential Tower, 3 Bedrooms: 2,610,000 Yen/month
- Grosvenor Place Kamizonocho, 4 Bedrooms: 2,600,000 Yen/month
- Azabu Gardens, 5 Bedrooms: 2,500,000 Yen/month
Source: The Nikkei Shimbun, January 8, 2021.
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