Key facts
- Average asking rents for office space in central Tokyo reached a 31-year high in July.
- Demand from companies relocating and expanding is driving the rent increases.
- Vacancy rates have declined across major Japanese cities.
- Tokyo's Grade A office space vacancy rate fell to 1.0%.
- The market is characterized by tightening supply.
Average asking rents for office space in central Tokyo have climbed to a new 31-year high in July. This sustained increase is attributed to strong and ongoing demand from companies actively relocating and expanding their operations. The tightening market is further evidenced by declining vacancy rates across major Japanese cities. In Tokyo, specifically, the vacancy rate for Grade A office spaces has fallen to a mere 1.0%. This low vacancy rate suggests a significant undersupply of prime office real estate in the city's core business districts, contributing to the upward pressure on rental prices. The trend indicates a robust commercial real estate market in Tokyo, driven by corporate activity and limited available space.