TOKYO -- The office vacancy rate in downtown Tokyo fell a ninth straight month in January, underscoring a growing shortage of office buildings here.
The rate in the five wards of central Tokyo -- Chiyoda, Chuo, Minato, Shinjuku and Shibuya -- came to 4.01% at the end of January, according to figures announced Wednesday by real estate brokerage Miki Shoji. It declined 0.02 point from the month before to the lowest in nearly seven and a half years.
Despite anxiety over the direction of the economy, there appears to be ample need for businesses to relocate or add more space in anticipation of future growth.
Real estate brokerage Sanko Estate reports that vacant space is disappearing in buildings completed during 2015, while Mitsubishi Estate projects that the Otemachi Financial City Grand Cube in Chiyoda Ward will fill up ahead of its scheduled completion in April.
Figures compiled by Miki Shoji show that asking rents in January averaged 17,790 yen ($156) per 3.3 sq. meters, up 98 yen from the month before and 4% higher than January 2015. Sumitomo Realty & Development reports that virtually all tenants with leases coming up for renewal have accepted hikes.
Many project that the supply of office space will increase in 2016 but that the supply-demand balance will not change much. Toyokazu Imazeki, chief analyst at Sanko Estate, sees low vacancy rates persisting at least until the spring 2017 consumption tax hike.
Office vacancy rates are also declining across the board in Osaka and Nagoya, but rents are climbing more slowly than in Tokyo.