- Both Grade A and large-scale Grade B offices continue on a positive trajectory, supported by rising rents and a return to pre-pandemic tight vacancy conditions
- Average Grade A office rents in the C5W strengthened by 1.9% quarter-on-quarter (QoQ) and 10.7% year-on-year (YoY) to JPY37,586 per tsubo per month.
- The average Grade A office vacancy rate in the C5W tightened further by 0.1 percentage points (ppts) QoQ and 1.9ppts YoY to 0.4%.
- Average large-scale Grade B office rents grew by 2.2% QoQ and 11.8% YoY to JPY28,568 per tsubo per month.
- Vacancy rates in the large-scale Grade B market tightened by 0.4ppts QoQ and 1.5ppts YoY to 1.1%.
- Prime bayfront offices, which struggled during the pandemic, are re-emerging as attractive options, with rents still significantly discounted relative to core areas.
- Inflation-linked office leases expected to emerge in 2026, could support more sustainable long-term rental growth, although the leasing model remains experimental.
Office market extends its upswing
Vacancy tightening to pre-pandemic lows is expected to push Tokyo's average office rents above their pre-pandemic peak in 2026.
Savills Research & Consultancy