Xymax Real Estate Institute

RESEARCH REPORTOSAKA CITY | Supply of New Office Space 2017 & Office StockPyramid 2017
December 26, 2016

Xymax Real Estate Institute released a report on Supply of New Office Space 2017 and Office Stock Pyramid
2017 covering the Osaka city office area. The volume of new supply in the coming years indicates a direct
impact on the market balance in the future. The Office Stock Pyramid is an aggregation of all the rentable areasof office buildings in the market and it shows the breakdown of the office building stock (rentable area andnumber of buildings) by size of the building (small/medium/large) and by age, and the balance and proportionof office buildings in the market.
From this report, these two studies were combined into one report.

1 tsubo = approx. 3.3 sq m
SUMMARY OF RESULTSOSAKA CITY | Supply of New Office Space 2017
New supply in 2017 is 31,000 tsubo. This is roughly equivalent to the 10-year average.

Average new supply in 2017-2020 is 17,000 tsubo per annum based on rentable area. This is approx. 50%of the 10-year average of 30,000 tsubo.

Average new supply in 2017-2020 in Osaka city (17,000 tsubo per annum) is less than one-tenth ofaverage new supply in Tokyo 23 Wards (181,000 tsubo per annum).

New supply rate (new supply in 2017-2020 versus office stock at year-end 2016) is expected to beapprox. 2.4% (0.6% per annum on average).

OSAKA CITY | Office Stock Pyramid 2017


Office stock at year-end 2017 is 2.84 million tsubo based on the rentable area: 1.41 million tsubo in small
and medium buildings and 1.43 million tsubo in large buildings; the volume is roughly the same.

Office stock in Osaka city (2.84 million tsubo) is less than a quarter of office stock in Tokyo 23 Wards(12.26 million tsubo).

In the number basis, the office stock is 1,712 buildings. Of them, small and medium buildings account fornearly 90% (1,522 buildings).

Buildings' average age is 30.3 years for all the stock, 30.7 years for small and medium buildings and 26.6
years for large buildings. Aging of stock is prominent in small and medium buildings.

OSAKA CITY | Supply of New Office Space 2017 & Office Stock Pyramid 2017
All rights reserved. All the contents are as of the date of this report. Xymax Corporation does not guarantee the accuracy or completeness of the information herein.
Copying, quoting, forwarding, distributing, reprinting or any other use of this report is not allowed without prior permission from Xymax Corporation.
Copyright © 2017 Xymax Real Estate Institute Corporation. All rights reserved.

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OSAKA
A CITY | Supply
Sof Neww Office Space 20172

The new suppply in 2017 is 31,000 tssubo, which is approxima
ately equivalent to the aaverage annu
ual volume inn2007-2016 ((hereinafter the "10-year average"). The average
e new supplly in 2017-22020 is 17,00
00 tsubo peerannum and is the same as our prev
vious study inn 2016*1 for 2016-2019 (Figure 1) aand about 50
0% of 30,000
0tsubo in the 10-year average.
If we look att large buildings with 100,000 tsubo oor above gro
oss floor area
a, the averag
ge supply in 2017-2020 is
17,000 tsubo
o per annum; somewhat below the 100-year averag
ge of 21,000 tsubo per annnum. For yo
our referencee,if we compared the new supply in Ossaka city withh that of Tokyyo 23 Wards, the averagee new supply in Osaka cityy
in 2017-2020
0 is less thann one-tenth ofo 181,000 ts ubo in Tokyoo 23 Wards.
The new suppply rate, which is the ratte of new su pply in 20177-2020 versuss the office sstock at yearr-end 2016, isapproximate
ely 2.4% (0.6%% per annumm).
*1 Supply of Ne
ew Office Space 2016 released ono December 244, 2015 https://wwww.xymax.co.jp/english/reseaarch/images/pdff/20151224.pdf

Figuure 1: Osaka City Supplyy of New Offfice Space (NNet Rentablee Area)

By area, the new supplyy is in Osaka''s major officce areas: Ummeda, Dojimaa-Nakanoshim
BParkk,ma, Osaka Business
Namba and Yodoyabashi (Figure 2).
gure 2: New Supply by Area
A(2017-22020)Fig

OSAKA CITY | Supply of New
w Office Space 2017
2& Office S
Stock Pyramid 2017
All rights reserved. All the contents are as of the date of th
his report. Xymax Co
orporation does not guaranteegthe accura
acy or completenesss of the information herein.
Copying, quoting, foorwarding, distributing, reprinting or any othero
use of this repo
ort is not allowed witthout prior permission from Xymax Corpooration.
Copyright © 2017 Xyymax Real Estate Insttitute Corporation. Alll rights reserved.

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T｜Xymax Reeal Estate Innstitute

OSAKA
A CITY | OfficeOStockS
Pyyramid 2017The Office S
Stock Pyramiid follows thhe method oof a populatiion pyramid representing
g the distrib
bution of ageegroups by ggender. We divided
dthe officeobuilding
g stock into small and mediummbuild
dings and large buildings
and then coompared theiir rentable arrea and the number of buildings
bby age. The pyyramid showss the balanceeand proportion of the offfice stock.
The office sttock in Osakka city as of end of 20177 is 2.84 million tsubo ba
ased on renttable area. Of
O them, 1.41
1million tsubo
o is small andd medium buuildings (grosss floor area:: less than 5,0000 tsubo) w
whereas 1.43 million tsubo
ois large build
dings (gross floor area: 5,0005tsubo aand above); the rentable area of the two is appro
oximately theesame (Figurre 3). The offfice stock in Osaka
Ocity (22.84 million tsubo)
tis less than a quarrter of 12.26 million tsubooin Tokyo 23 WWards.
The average
e age of the buildings is 30.3 years. O
Of them, thee average age
e is 30.7 yeaars for small and medium
mbuildings and 26.6 years for large buiildings. The n
new supply continued forr large buildinngs even afte
er the bubble
eera but for small and medium
mbuilddings, the stoock is aging since the supply has beeen weak affter the largeevolume of su
upply in the bubblebera.
By age, overr 80% (1.21 million tsuboo) of the sm
mall and med
dium building
gs were connstructed 20 years ago orobefore while
e 200,000 tsubo were connstructed in tthe recent 200 years.
In large build
dings, nearlyy 70% (940,0000 tsubo) waas constructe
ed 20 years ago or beforee while 490,000 tsubo wasconstructed in the recentt 20 years.
Figu
ure 3: Osakaa City Officee Stock Pyramid 2017(NNet Rentablee Area)
Small & Medium vs Large

OSAKA CITY | Supply of New
w Office Space 2017
2& Office S
Stock Pyramid 2017
All rights reserved. All the contents are as of the date of th
his report. Xymax Coorporation does not guaranteegthe accura
acy or completenesss of the information herein.
Copying, quoting, foorwarding, distributing, reprinting or any otherouse of this repo
ort is not allowed witthout prior permission from Xymax Corpooration.
Copyright © 2017 Xyymax Real Estate Insttitute Corporation. Alll rights reserved.

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T｜Xymax Reeal Estate InnstituteIn the numbber basis, therre are 1,712 buildings in Osaka city. TheT breakdow
wn is as follow
ws: 1,522 buuildings (89%%)are small or medium buildings and 190 buildingss (11%) are laarge buildings (Figure 4)..
C Office S
Stock Pyram
mid 2017 (Nuumber of Buuildings)
Figurre 4: Osaka City
Small & Medium vs Large

OSAKA CITY | Supply of New
w Office Space 2017
2& Office S
Stock Pyramid 2017
All rights reserved. All the contents are as of the date of th
his report. Xymax Coorporation does not guarantee
gthe accura
acy or completenesss of the information herein.
Copying, quoting, foorwarding, distributing, reprinting or any otherouse of this repo
ort is not allowed witthout prior permission from Xymax Corpooration.
Copyright © 2017 Xyymax Real Estate Insttitute Corporation. Alll rights reserved.

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RESEARCH REPORT｜Xymax Real Estate Institute

OVERVIEW OF STUDY

Supply of New Office Space
Date

November 2016

Area

Osaka city

Subject
Building

3,000 tsubo or above gross floor area / Used mainly as office space (but excluding
owner-occupied buildings)

Subject Data

Office rentable area (tsubo)

MethodBased on publicly available information such as newspaper articles. Also some site
inspections and interviews with developers.

• The subject of this study is the floor area of new supply. This is not a complete survey.
• If the net rentable area is publicly available, that size is used in this study. If not, we estimated it based on the gross floor area withthe formula jointly developed with the laboratory of Dr. Naoki Katoh, Professor of Kyoto University Graduate School of Engineering.
• The new supply estimated in this study is the estimated amount as of the date of this study. Actual new supply changes as newinformation becomes available.

Office Stock Pyramid
DateNovember 2016

Area

Osaka city

SubjectBuilding

As of the end of 2017 / 300 tsubo or above gross floor area / Construction completed inor after 1946 (incl. buildings to be completed within 2017) / Used mainly as office

Subject Data

Number of office buildings and rentable office areas of large buildings and small andmedium buildings.
Large buildings (gross floor area: 5,000 tsubo or above)
Small and medium buildings (gross floor area: 300-5,000 tsubo)• The data were collected from publicly available information such as newspaper articles and for-rent information (in the past too).
We collected the data of buildings if their date of construction is available. Owner-occupied buildings were excluded.
• The data of new constructions replacing the old buildings and the data of demolished buildings have been collected and reflectedto the extent possible.
• The amounts in this study are the amounts as of the date of this study and are subject to change as new information becomes
available.
• The office stock in 2017 includes buildings which will be completed in 2017 if such completion schedule is available as of Nov. 2016.
• If the net rentable area is publicly available, that size is used in this study. If not, we estimated it based on the gross floor area withthe formula jointly developed with the laboratory of Dr. Naoki Katoh, Professor of Kyoto University Graduate School of Engineering.
• Buildings constructed under the "old seismic standards” refer to the buildings constructed before the enforcement of the newseismic standards in 1981. In this study, buildings completed in 1981 or before were deemed as constructed in line with the old
seismic standards.

OSAKA CITY | Supply of New Office Space 2017 & Office Stock Pyramid 2017
All rights reserved. All the contents are as of the date of this report. Xymax Corporation does not guarantee the accuracy or completeness of the information herein.
Copying, quoting, forwarding, distributing, reprinting or any other use of this report is not allowed without prior permission from Xymax Corporation.
Copyright © 2017 Xymax Real Estate Institute Corporation. All rights reserved.

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