#Japan #Tokyo #Tokyo Office #Sanko Estate #NLI Research

Sanko Estate and NLI Research Institute Release Quarter 3 Office Rent Index 2025

On October 31, 2025, Sanko Estate Co., Ltd., headquartered in the Chuo Ward of Tokyo and led by President Masajiro Fukushima, announced the latest quarterly report on the Office Rent Index. This report was developed in collaboration with the NLI Research Institute, located in the Chiyoda Ward of Tokyo and headed by President Toshiaki Tejima. The findings provide an insightful overview of the state of the office rental market in the metropolitan area during the third quarter of 2025.

Overview of Q3 2025 Office Rent Index

In the heart of Tokyo, the rental prices for A-Class buildings have recovered to the level of ¥34,000 per tsubo, a significant milestone reached since Q3 2021. Meanwhile, B-Class buildings have surpassed their peak rental rate from Q3 2019. C-Class buildings also show a modest increase for the fourth consecutive term, indicating ongoing market growth.

A-Class Office Rental Rates and Vacancy Rates

For the A-Class buildings, the rental price has reached ¥34,082 per tsubo (excluding common service fees), marking an increase of ¥3,519 per tsubo over the previous quarter. This achievement reflects an upward trend that has been sustained for eight consecutive terms since last assessed.

Additionally, the vacancy rate has significantly fallen to 1.3%, a decrease of 1.0 percentage points compared to the previous quarter, placing it at the lowest level since Q2 2021. This decline is primarily attributed to the absorption of larger vacant spaces in newly constructed buildings in the Minato Ward. As the demand for office spaces remains robust, active negotiations are underway for many available units, leading to a heightened sense of scarcity.

With no expected supply of A-Class buildings in Q4 2025, it is anticipated that the downward trend in vacancy rates will continue heading toward the end of the year.

B-Class Office Rental Rates and Vacancy Rates

In the case of B-Class offices, rentals have risen to ¥24,225 per tsubo (also excluding common service fees), reflecting an increase of ¥1,934 per tsubo from the last quarter. This figure has now exceeded the peak observed in Q3 2019. The year-on-year increase also marks the eighth consecutive rise, indicating a continuous upward trajectory since reaching a low point in Q1 2023.

The vacancy rate for B-Class offices has decreased to 1.9%, down 0.3 percentage points from the previous quarter, marking a sustained decline for eight consecutive terms and bringing it to levels not seen since Q4 2020. The successful absorption of vacant spaces in both newly built and recently renovated buildings, particularly in the bay area, underpins this trend. There is a noticeable tightness in the market particularly for well-located properties, leading to a spillover demand for buildings in comparatively less convenient locations.

C-Class Office Rental Rates and Vacancy Rates

C-Class offices have reported a rental price of ¥19,501 per tsubo, reflecting an increase of ¥459 per tsubo over the last quarter. This marks the fourth consecutive increase, demonstrating a steady ascension within this segment of the market.

The current vacancy rate stands at 2.4%, having dropped by 0.2 percentage points from the prior period. This reduction has been driven by initiatives such as company relocations and the opening of branch offices focused on newly constructed and recently renovated buildings. The overall downward trend in vacancy rates has been evident since peaking at 5.0% in Q3 2022.

Year-on-Year Comparative Analysis

When comparing the figures from Q3 2024, A-Class rents have surged by 27.2%, B-Class by 24.7%, and C-Class by 8.1%. Notably, both A-Class and B-Class offices have seen positive growth for six and eight consecutive terms, respectively.

About Sanko Estate Co., Ltd.

Founded on May 17, 1977, Sanko Estate Co., Ltd. provides comprehensive support for corporate office strategies. From verifying and proposing optimal workplaces to assisting with selecting and brokering rental office buildings, Sanko Estate meets a wide range of client needs with essential management capabilities for executing projects related to office requirements.

For further information, visit the Sanko Estate website: Sanko Estate

This release aims solely to provide information and has been prepared with caution regarding its accuracy. However, it does not guarantee the content. Please use this information at your own discretion and responsibility.

Conclusion

The office rental market in Tokyo continues to exhibit signs of a strong recovery, with both prevailing rental prices and declining vacancy rates indicating a vibrant demand. As we move forward, the anticipation for future developments and ongoing trends will be pivotal in reshaping the business landscape.