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Yahoo Japan to slash 40% of its Tokyo office space

More companies expect work-from-home culture to outlast COVID

Yahoo Japan will leave seven of 20 floors at its Kioi Tower headquarters, in Tokyo's Chiyoda Ward, in the fall. (Photo by Kosaku Mimura)

TOKYO -- Yahoo Japan will vacate 40% of its Tokyo office space by November as it expects the COVID-necessitated work-from-home trend to gain permanence.

The subsidiary of SoftBank-backed Z Holdings will return about 30,000 sq. meters, more than four soccer fields worth, of office space, when leases expire.

It will empty out seven of 20 floors at its Kioi Tower headquarters, in Tokyo's Chiyoda Ward, and all five floors that it has in Akasaka K Tower, in Minato Ward.

Only about 10% of Yahoo's staff have been working in the office since the COVID-19 pandemic began.

The government's digital agency will move into some of the vacated space. Calculations based on the digital agency's lease suggest Yahoo will save billions of yen in Kioi Tower rent alone.

Yahoo will share its remaining office space with the Z Holdings group.

The company is the latest to downsize its office footprint. Professional services provider Deloitte Tohmatsu Group this summer returned two floors of a building near Tokyo Station. DeNA, a mobile and online services company, moved its headquarters to shared office space after estimating that only 30% of its workers would come to the office.

According to office building brokerage Miki Shoji, the average vacancy rate in five Tokyo wards in July was 6.28%, surpassing the oversupply benchmark of 5% for six consecutive months.

Yahoo Japan has been incentivizing remote work. Last October, it began paying a monthly work-from-home allowance of 7,000 yen ($64), then raised it to 9,000 yen in April. All of its 8,000 employees are eligible for the allowance.

The company also changed a residence requirement last October, allowing employees to live anywhere they want as long as they can arrive at the office by 11 a.m. using public transit, excluding airplanes. Some Yahoo workers have since moved far from Tokyo, to Nagano, Miyagi and Niigata prefectures.

In a survey of Yahoo employees in June 2020, 93% said working from home either does not affect productivity or leads to improved productivity.

"An office is only one option for working space," Yahoo Japan said, "and [the company] will make it easy for employees to work at home or outside of the office."

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