Tokyo Office Rents Continue to Fall

Japan's deepest recession in the postwar period is taking its toll on Tokyo commercial property prices and rents. If you are searching for office space, its a buyer's market, with older buildings in areas like Shibuya offering rents over 30% lower than those for tenants who have been in place for a couple of years. Owners more desperate to get their office space leased are also offering "free rent" periods of up to six months to offset the cost of restoring existing office space to its original condition and the cost of moving to a new location.

A Nikkei survey of Tokyo and Osaka office rents taken in mid-October shows even Tokyo office rents for newly completed buildings declining for two consecutive years, while rents for new buildings in Osaka are the lowest since August 1998. Average rent levels for both cities are approaching the lows seen in 2000. If you are observant, you can see the empty floors in office buildings throughout Tokyo.