The Widening Office Competition: A Survey of the Tokyo Metropolitan Office Market

Sanko Estate, utilizing data on rental office buildings, has conducted a study on office market trends in collaboration with the University of Tsukuba's Real Estate and Spatial Econometrics Laboratory. This report updates the vacancy rates by transport accessibility published in March 2025 and presents new findings based on station-level vacancy rates for the Tokyo metropolitan area.

Vacancy Rates by Accessibility: Even Single-Line Buildings See Vacancy Absorption We grouped large-scale buildings (1 floor area over 200 tsubo) in Tokyo's 23 wards that are at least one year old by the number of surrounding rail lines to calculate vacancy rates. The vacancy rate for buildings with high accessibility, served by five or more lines, began a downward trend early in 2022, reaching 0.56% in March 2026—a return to pre-pandemic levels. Meanwhile, the vacancy rate for less accessible buildings with only one surrounding rail line rose to 8.78% in July 2024, but subsequently fell to 3.07% in March 2026. This is primarily due to demand spreading to less accessible areas as prime buildings become scarce. However, vacancy rates for buildings with one or two-to-four lines have not yet reached pre-pandemic levels, suggesting further room for improvement.

Station-Level Vacancy Rates: 50% of Stations Under 2% When calculating station-level vacancy rates for medium-to-large buildings (1 floor area over 50 tsubo) across the one metropolis and three prefectures, 55.3% of stations had a vacancy rate below 2% as of March 2026. Although this is below the 76.6% seen in December 2019, before the pandemic, many stations—particularly in the Marunouchi and Otemachi areas—have vacancy rates below 1%. In these areas where the supply-demand balance is tight, instances of multiple tenants competing for rare vacancies are increasing. Stations in Tokyo with vacancy rates exceeding 5%—the dividing line between a tenant's market and a landlord's market—are limited to certain areas like the waterfront and Kagurazaka. Although vacancy rates around Kachidoki and Tsukishima stations, which had high vacancy rates for a long time since the pandemic, rose to the 20% range in 2023, current levels are in the 4% and 5% ranges, respectively, showing a spillover of demand into the waterfront area. In Saitama, Chiba, and Kanagawa prefectures, vacancy rates exceed 5% at stations like Saitama-Shintoshin, Makuhari, and Kannai. However, the rises at Kannai and Saitama-Shintoshin are temporary, resulting from the completion of new buildings with initial vacancies, not a loosening of supply-demand. It is important to note that station-level vacancy rate data can have significant variations due to small sample sizes and should not be directly compared in a blanket manner.

Increasing Difficulty in Securing Office Space Demand for prime, high-quality offices remains strong, driven by companies seeking to gain a competitive edge in hiring and improve employee engagement. However, available space in such buildings is limited, and demand is tight. Demand is also concentrating on buildings currently under construction, with approximately 90% of large-scale buildings scheduled for completion in 2026 already having tenants secured. Consequently, tenant recruitment is advancing for buildings scheduled for completion in 2027–2028. For tenants considering relocation, securing office space that meets criteria such as location, size, and budget is becoming increasingly difficult. Quantitatively, factors that would loosen the supply-demand balance are limited, so vacancy rates are expected to continue declining or remain flat. Given the ever-changing social and global situation, it is crucial to stay informed and carefully assess market trends.