New Research

Tokyo Office Space Market Index Q3 2014
Contract Rent DI | New Contract Rent Index | Ratio of Free Rent Granted | Average Free Rent (Month)

Xymax Real Estate Institute releases the third quarter 2014 results of the office space market indices: Contract Rent DI, New Contract Rent Index, Ratio of Free Rent Granted and Average Free Rent (Month).

Tokyo 23 Wards Office Space Market Index (Q3 2011 – Q3 2014)
  Q3 2011 Q3 2012 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014
Contract Rent DI -28 -36 6 0 9 19 11
New Contract Rent Index 93 82 87 87 94 91 94
Free Rent Granted
(All Contracts)
88.2% 70.7% 64.6% 66.1% 69.9% 68.6% 70.0%
Average Month 4.8 4.1 3.9 3.8 3.7 3.3 3.5

  • ・Contract Rent Diffusion Index (DI) was +11, recorded three consecutive positive quarters, which means the number of buildings with a rent increase was higher than the number of buildings with a rent decrease. The overall rental growth is, however, yet to come as the positive range remained flat.
  • ・New Contract Rent Index (Q1 2010 = 100), which shows the level of contract rent, was 94; +3 quarter-on-quarter and +7 year-on-year. The contract rent level is growing modestly after the bottom in 2012.
  • ・Ratio of Free Rent Granted (All Contracts) was 70%; +1.4 points quarter-on-quarter. Average Free Rent (Month) was 3.5 months; +0.2 months quarter-on-quarter. The grant ratio remained high, but the average free rent shown in months is becoming shorter due to a decrease of long-term free rent.

The overall Tokyo 23 wards office space market is on track for a slow recovery, supported by strong demand for office spaces as IT and staffing sectors are having buoyant business results and adding workers. Other factors are that the large buildings, supplied around 2012, have been generally taken up, and there is limited new supply expected in the near term.

The market is split into two different directions: recently constructed large buildings are more in short supply as tenants continue to show strong interests, whereas buildings that failed to attract tenants continue to see a rent decrease.

Download PDF File
New Research
Back Number