New Research

Downtime of New Lease in Tokyo: 98.5 days (approx. 3.3 months)
FY2012 (April 2012 - March 2013)

Xymax studied the length of downtime (vacancy period) of office spaces.

Downtime, which is the period of time between the end of a prior lease and the new lease starts, is a concern for various types of real estate players including building owners and investors because it is a period of loss of profits. Nevertheless, no such data or index representing actual conditions was available until now. Xymax Real Estate Institute therefore conducted studies on downtime in office buildings to capture the actual situation.

In this issue, days of downtime of new lease signed in FY2012 were counted and analyzed.

Key Findings

Downtime of new lease signed in FY2012

・Tokyo 23 Wards Office: 98.5 days (approx. 3.3 months)
・Other Areas Office: 196.0 days (approx. 6.5 months)

Of the office spaces in Tokyo 23 Wards, downtime was 90.5 days (approx. 3.0 months) in Central Five Wards and 121.5 days (approx. 4.0 months) in other wards.

In Tokyo 23 Wards, approx. 17% had no downtime (0 day),and approx. 50% had downtime of less than 3 months


  • Buildings constructed under New Seismic Standards have shorter downtime than those constructed under Old Seismic Standards.
  • No particular correlation between the size of rentable area (small/large) and the length of downtime (short/ long) was found.

Downtime (vacancy period) is the period of time from the end of a prior lease and the start of a new lease. In other words; it is the period with no lease contract. No rental income is generated during this period, and therefore it is important to capture the actual trends of downtime when estimating the impact on income stream or value of the property in real estate investment and appraisal. The period with no rental income is actually longer than downtime as some new leases often have a free rent period for the initial few months of the lease. Thus the period with no rental income refers to the total of downtime and free rent period. Office tenants in Japan usually submit a cancellation notice six months prior to their departure, and building owners start leasing activities following some preparation period after they received a cancellation notice. The period of leasing activities starts with marketing the space to potential tenants and ends with the signing of the new lease.

Xymax Real Estate Institute is currently pursuing constructive studies on downtime and willing to provide data that is useful in understanding the real estate market from a multilateral point of view.

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