Tokyo office vacancy rate hits new low in November

The average vacancy rate for prime office space in Tokyo’s central five business districts hit a new low in November, dropping 0.07 points from the previous month to 1.56%. This is the lowest vacancy rate seen since December 1990 when the average rate was just 0.39%.  Meanwhile, average rents have increased for the past 71 consecutive months.

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Kyoto’s office shortage is getting dire

Kyoto’s shortage of office space is becoming critical as vacancy rates drop below 1%. With a booming tourist industry, developers have been focusing on building hotels, leaving very little supply of new offices. 

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Tokyo office vacancy reaches lowest level in 29 years

The office vacancy rate across Tokyo’s central five business districts dropped to 1.64% in May, down 1.04 points from last year and the lowest level seen since December 1990 when the rate was 0.39%. 

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Central Tokyo office rents increase for 49th month in a row

The average monthly office rent in central Tokyo’s business districts was 19,338 Yen per Tsubo (approx. 5,860 Yen/sqm) in January, up 4.1% from last year and the 49th month in a row to see a year-on-year increase. This is the highest level seen since October 2009. Office rents are now up 19.3% from their recent low of 16,207 Yen/Tsubo seen in December 2013, but are still 15.5% below a previous record high in mid-2008.

Vacancy rates were down 0.67 points from last year to 3.07%. This is similar to levels last seen in 2007 and a marked improvement from the average 8 ~ 9% vacancy rate seen between 2010 and 2014.Read more


Shinjuku office vacancy rate drops to 1% range

The office vacancy rate across Tokyo’s five central business districts of Chiyoda, Chuo, Minato, Shinjuku and Shibuya dropped to 3.22% in July, down 0.04 points from June and down 0.72 points from July 2016. This is close to the record low of of 3.03% reported in April 2008 and down from a high of 9.43% seen in June 2012.

The vacancy rate in existing buildings (excluding new construction) was 2.87% in July, down 0.74 points from last year.

In Shinjuku ward, the vacancy rate was 1.68%, down 0.06 points from the previous month and down 1.30 points from last year. The vacancy rate dropped to the 1% range in May 2017.

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Tokyo's office market continues to strengthen

In August, the office vacancy rate in Tokyo’s five central business districts (Chiyoda, Chuo, Minato, Shinjuku and Shibuya) was 4.72%, down 0.17 points from the previous month and down 1.30 points from last year. This is the lowest vacancy rate seen since December 2008. Shibuya had the lowest vacancy of 2.22%, down 0.05 points from July and down 1.79 points from last year.

With vacancy rates below the 5% level said to indicate a healthy balance between demand and supply, rents continue to increase. The average monthly office rent was 17,490 Yen per Tsubo (5,300 Yen/sqm), up 0.01% from the previous month and up 4.5% from last year. This is the 20th month in a row to see a month-on-month increase.Read more


Office vacancy rates in September 2014 - Miki Shoji

According to Miki Shoji’s office report, the office vacancy rate in Tokyo’s five central business districts (Chiyoda, Chuo, Minato, Shinjuku and Shibuya) was 5.65% in September, down 0.37 points from the previous month and down 2.25 points from last year. This is the first time since February 2009 that vacancy rates had dropped to the 5% range.

The 5% range is considered to be the tipping point between supply and demand. As a result, real estate companies have started to raise rents. Mitsubishi Jisho have begun seeking an increase of rent of around 5 ~ 10% in the 30 buildings they own in the Marunouchi and Otemachi business district in front of Tokyo Station. Mori Building have also started negotiating with tenants in relatively new buildings for higher rents. Mitsui Fudosan are also setting higher rents for new leases.

Meanwhile, office tenants continue to seek ways to control costs and mid-size and regional building owners are hesitant to raise rents. While vacancy rates have fallen sharply, rents are not increasing at the same speed.Read more