Nagoya Grade A Rent Breaks Thirty Thousand Yen As Tokyo Vacancy Stays Tight

Japan's office market is giving property investors a regional signal: Tokyo remains scarce, while Nagoya's Grade A rent has crossed a new threshold.

Tokyo Remains Supply Constrained

JLL reported Tokyo Grade A vacancy at 0.8 percent in Q2 and monthly gross rent at JPY42,109 per tsubo, up 4.6 percent from the previous quarter. CBRE also found Tokyo all-grade vacancy at only 1.4 percent, with rents rising across grades.

Nagoya Set A Rent Marker

CBRE reported that Nagoya Grade A assumed achievable rent surpassed JPY30,000 per tsubo for the first time on record. That matters because rental pressure is no longer limited to Tokyo's most expensive business nodes.

Construction Costs Support Existing Stock

Delayed completions and elevated building costs restrict tenant options in core submarkets. Existing towers with strong seismic performance, energy credentials and large floor plates can therefore capture demand from occupiers upgrading space.

Buyer Checks

Investors should review lease expiries, rent reversion, tenant concentration, remaining vacant floors, capex, seismic rating, energy performance and debt costs. Residential buyers near office cores should still compare management fees and resale depth.

Outlook

Tokyo scarcity and Nagoya's rent milestone support prime income assets, but rising yields remain a risk. Buildings with documented tenant demand and manageable capex should hold value better than older stock relying only on low vacancy.

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