Tokyo Grade B office rents up 11.1% in Q3

Chiyoda led rental growth during the quarter.

In a report, Savills revealed that Tokyo’s large-scale Grade B market continued to strengthen in tandem with the Grade A market, with average rents increasing by 4.6% QoQ and 11.1% YoY to JPY27,957 per tsubo in Q3/2025.

“Chiyoda led the broad-based rental growth across the C5W, recording a quarterly rental gain of 6.8%, and a more impressive annual 12.7% growth, reflecting robust demand,” the report said.

Here’s more from Savills:

Chuo, Minato, and Shinjuku followed with steady increases, supported by the relative scarcity of new Grade A stock, which has funnelled some demand into the Grade B space. Shibuya’s rents witnessed the least quarterly rental growth of 1.7%, though annual growth remained strong at 10.1%.

Average large-scale Grade B vacancy levels rose marginally by 0.1ppts QoQ, but remained on a tightening trend, falling by 1.4ppts YoY to 1.5% in Q3/2025. Chiyoda and Shinjuku both saw a marginal decrease while Shibuya, Minato and Chuo experienced an uptick in vacancies.

Overall, the large-scale Grade B market continues to see rental growth outperforming Grade A offices, with broad-based growth across the C5W despite modest fluctuations in vacancy. The ability of landlords to sustain higher rents in the face of slight availability increases shows the depth of underlying demand, and many are capitalising on the chance to raise rents after missing earlier opportunities.

Demand is expected to remain strong, particularly from tenants who are unable to access the limited Grade A stock. In addition, rising construction costs will constrain future new supply, further tightening the supply-demand equilibrium.