Tokyo vacancies dip to 7-year low
2015.12.30 NewsThe office market in Japan's capital remains healthy, with less space available and rents going up.
The vacancy rate in the five wards of central Tokyo -- Chiyoda, Chuo, Minato, Shinjuku and Shibuya -- stood at 4.19% at the end of November, down 0.27 percentage point from October, according to data released Thursday by real estate brokerage Miki Shoji. It slid to the lowest in seven years and two months and fell for a seventh straight month.
The number has been on a downtrend since hitting a 9.43% peak in June 2012. The shortage of space is increasingly felt for buildings in prime locations.Encouraged by improved earnings, many businesses are moving or expanding their offices. Otemon Tower JX Building, a complex in the Otemachi business district, was fully leased on all floors before its November completion. Sumitomo Fudosan Mita Twin Building, which was finished in November near Tamachi Station, is now completely occupied after Bandai Namco Holdings signed on as a tenant. Shinagawa Season Terrace, two-thirds of which was unoccupied when it was completed in February, now apparently has seen its vacancy rate drop to 20%.
Rents are rising. The average asking rent per 3.3 sq. meters jumped 687 yen ($5.61) over the past year, making it clearly a lessor's market, particularly for large properties.
The average came to 17,637 yen per 3.3 sq. meters in November, up 25 yen on the month, according to Miki Shoji. Rents have risen for 23 straight months, hitting the highest since October 2010.
"Many businesses are adding employees and feel they need more space, so the market will remain strong" in 2016 and beyond, predicts Toyokazu Imazeki, chief analyst at Sanko Estate.
See more information at Japan Property
