July 20, 2018

Office Offer Period and Asking Rent

Xymax Real Estate Institute (hereinafter, "Xymax REI") has continuously conducted various analyses focusing on vacancies. In addition to vacancy rates and the survey on change in vacancies it publishes on a regular basis, Xymax REI published the "offer period,"^*1 which is the duration of time from when a vacant office is put on offer until the end of the offer, in February 2018.

In this report, Xymax REI analyzes the relationship between the offer period and asking rent.

*1 "Average Offer Periods of Offices" February 1, 2018
https://www.xymax.co.jp/english/research/release/180201.html

Summary of Survey Results
A survey on changes in rent during offer periods revealed that 82.6% of office blocks did not change the rent, 12.8% lowered the rent from the initial asking rent, and 4.6% raised the rent. More than 90% of office blocks with offer periods equivalent to the average office offer period (five months) or shorter found tenants without changing their asking rent. The longer the offer period becomes, the smaller the percentage of office blocks that did not change their initial asking rent before finding a tenant will be.

Summary of Survey Results

- A survey on changes in rent during offer periods revealed that 82.6% of office blocks did not change the rent, 12.8% lowered the rent from the initial asking rent, and 4.6% raised the rent.
- More than 90% of office blocks with offer periods equivalent to the average office offer period (five months) or shorter found tenants without changing their asking rent.
- The longer the offer period becomes, the smaller the percentage of office blocks that did not change their initial asking rent before finding a tenant will be.