Tokyo Grade A office rents up 3.2% in Q3

And vacancy tightened to 0.7%.

Elevated global uncertainty continues to weigh on sentiment, but Japan’s outlook is steadily improving. In a recent report, Savills said the economy has absorbed both the national election outcome and tariff-related concerns, fuelling corporate activity and investment appetite.

Here’s more from Savills:

Japan’s transaction market remains resilient, supported by its reputation as a safe, liquid, and mature destination despite monetary policy ambiguity. Logistics is regaining momentum with reduced new supply and strong demand for modern facilities.

Hospitality and high-street retail are buoyed by robust tourism and consumer spending, while residential rental growth remains firm on sound demographics. The office market is also growing robust, marked by ultra-low vacancy and active leasing. Overall, investor appetite remains strong, with highly active markets and fierce competition for acquisitions.

In Q3/2025, Grade A office rents increased 3.2% QoQ to JPY36,882 per tsubo, with vacancy tightening by 0.8 percentage points (ppts) QoQ to 0.7%. The substantial influx of supply has been swiftly absorbed through robust pre-leasing activity.

Prime office space remains a hot commodity, and will continue to attract tenants who are desperately looking to upgrade their office spaces. Rising construction costs are expected to result in project delays and stagger future supply, tightening the supply-demand equilibrium.