Last month, Orix JREIT signed an agreement to sell this office building alongside Platinum Avenue in Shirokane for ¥8.78 billion. The cap rate would be in the high 3% range.

It has been fully leased for at least the past 5 years and the average monthly rent across the building is around ¥23,900 per tsubo. It is being disposed of due to an expectation of rising maintenance costs due to the building age (it’s 26 years old) and may not hold much further potential growth as an office asset.

The 7-story building, with a net lettable area of 4,900 sqm, was built in 1998 for Sony Music Entertainment and designed by Horikoshi Hidetsugu Architect 5. Sony sold it to Pacific Management in 2006 for 10.4 billion Yen before flipping it a year later to Macquarie Global Property Advisors for an undisclosed price. Back then, the office space was leasing for as high as ¥36,000 ~ ¥38,000/tsubo.