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Tokyo Office Rent Index Q1 2026 Report

In the latest release on April 30, Sanko Estate Co., Ltd., in collaboration with Nissay Research Institute, unveiled the Tokyo Office Rent Index for the first quarter of 2026. This index tracks the rental market using contracted rent data and reveals remarkable trends in office rentals across different classes of buildings in central Tokyo.

Overview of Q1 2026

The report highlights that Class A office buildings in central Tokyo have exhibited a rental increase, marking a tenth consecutive quarter of growth with a notable 2,128 yen per tsubo increase from the previous quarter, bringing the current rental rate to 37,620 yen per tsubo (excluding common service fees). This consistent upward trend reflects an increase over eight quarters when compared year-over-year. Furthermore, the vacancy rate for Class A buildings has climbed slightly to 0.9%, up by 0.3 percentage points, following the concentration of new supply scheduled for 2026, which is expected to total approximately 166,000 tsubo.

Despite a healthy demand for office spaces, concerns over high energy prices influenced by geopolitical tensions, such as the blockade in the Strait of Hormuz, continue to raise doubts about economic stability. While corporate earnings seem to decline, they have not yet been reflected in the market data, indicating a need for close observation of upcoming trend developments.

Class B and C Office Buildings

For Class B office buildings, rental rates have also seen a rise, with a 185 yen per tsubo increment bringing the total to 22,895 yen per tsubo (excluding common fees). This increase has persisted for ten consecutive quarters since the market bottomed out in Q1 2023, demonstrating a clear upward trajectory. The vacancy rate for Class B buildings has improved, indicating a decrease of 0.1 percentage points to 1.4%. This trend suggests that the surrounding areas are successfully absorbing vacant spaces, amplifying the perception of a tight market.

Class C office buildings have likewise experienced a rise in rental prices, increasing by 138 yen per tsubo to reach 19,992 yen per tsubo. This marks the sixth consecutive quarter of growth and indicates the sector is approaching pre-pandemic levels from Q1 2020. Their vacancy rate decreased significantly, falling to 1.8%, the lowest since Q3 2020. A significant consumption of vacant spaces in newer buildings in central Tokyo is contributing to this trend, though further decreases in vacancy rates may still be on the horizon, given that the recent low was recorded at 0.6% during the pre-pandemic period.

Year-over-Year Rental Trends

Comparing to the same quarter last year, Class A buildings have seen a remarkable increase of 23.3%, Class B a growth of 14.2%, and Class C has incremented by 5.6%. The robust performance over the last eight to ten quarters illustrates a thriving market segment.

About Sanko Estate

Founded on May 17, 1977, Sanko Estate Co., Ltd. offers comprehensive support for corporate office strategies, assisting with the rental selection of office buildings, proposal verification for optimal workplaces, and management functions essential for successful project execution. More details about their services can be found on their official website here.

Please note, while this report aims to provide accurate information, it is advised that clients utilize this data at their discretion and risk.