Survey of Large-Scale Office Building Supply
in Tokyo’s 23 Wards 2019

April 15, 2019

Mori Trust Co., Ltd., (Head Office: Minato-ku, Tokyo) has surveyed supply trends for large-scale office buildings with total officespace of 10,000 square meters or more in Tokyo’s 23 wards since 1986 and for mid-size office buildings with total office spaceof 5,000 square meters to less than 10,000 square meters since 2013, based on various published materials, field surveys, andinterviews. The results of the most recent survey are presented below. In calculating total office floor area, where the survey
deals with multipurpose buildings—buildings that also contain retail space, residential space, or hotels—the calculation includes
only the floor area set aside solely for office use.
[Survey Date: December 2018]

With Toranomon leading the way, Minato Ward expected to account for themost new office space by ward over the five-year period starting in 2019
Main Results of This Survey
1. Supply of large-scale office buildings
In 2018, large-scale office buildings introduced to market in Tokyo’s 23 wards added 1,470,000 m2
to the region’s total inventory of office space, the fourth-highest annual figure over the past 20 years.
The amount of new space added is expected to shrink 1,020,000 m2 in 2019, but is projected toincrease once again to 1,790,000 m2 in 2020. The figure is projected to decline significantly in 2021
(to 530,000 m2) and in 2022 (to 550,000 m2) in response to the volumes added in preceding years,
but should increase once again in 2023 to 990,000 m2, close to the past 20-year average figure of
1,080,000 m2 for recent years.

2. Supply trends by area
Looking at the five years from 2019, the percentage of new space found in Tokyo’s three central
wards will remain high; among wards, Minato Ward’s share is expected to rise sharply. By district, theamount of new office space introduced is expected to be highest in Toranomon and Shinbashi, taking
over the top spot from Otemachi, Marunouchi, and Yurakucho. Outside the three central wards, acertain level of the amount of new office space introduced is expected to remain relatively constant in
Shibuya Ward, as the recent rise in Shibuya’s presence will be seen in supply levels as well.

3. Supply trends by type of development site
In the three central wards, “Rebuilding” previously accounted for the majority of total available
office space. However, “Undeveloped/underdeveloped land : Redevelopment, etc.” that has grown inrecent years. Cumulatively, over the next five years, space on “Undeveloped/underdeveloped land :Redevelopment, etc.” is projected to account for over 50% of supply. Outside the three central wards,
supply using “Undeveloped/underdeveloped land : Redevelopment, etc.” is projected to maintain ashare of around 70%.

4. Supply of mid-size office buildings
The figure for new office space introduced in mid-scale office buildings in 2018 was 129,000 m2.
This is higher than the figure for the year before, but lower than the average for the preceding ten
years (132,000 m2). The figure for new office introduced in 2019 and 2020 is also expected to fallshort of the average for the recent past. The three central wards accounted for 70% of this new
space, with Minato Ward alone accounting for 40%, the leading share.

Conclusion

In 2018, nearly all space in new large-scale office buildings were preleased before the buildings opened.
The buildings scheduled to be completed in 2019 are also more or less no longer seeking tenants. Evenbuildings scheduled to be completed in 2020 are attracting tenants. The supply of new office space in 2021
and 2022 is projected to tighten to around half the average for the recent past; some buildings scheduled forcompletion in 2021 already have tenants lined up. These trends suggest the new office building market willremain firm. In addition, vacancies in existing buildings from tenants relocating to new buildings (secondary
vacancies) are steadily being filled due to robust expansion in demand. The market for space in older
buildings is projected to maintain its strength. The figure for new space introduced in 2023 is projected toreturn to average levels for the recent past, as the decline in response to the glut of new space subsides.
Figures for total office floor space (stock) in 2017 began to rise in all three central wards for the first timesince 2012, a span of five years. The main category of land for large-scale office building supply is shiftingfrom “Rebuilding” to “Undeveloped/underdeveloped land” resulting in increased stock. The increase in stock,which has been gradual to this point, warrants monitoring going forward.
Fears concerning a deteriorating supply-demand balance due to the influx of new space proved unfounded.
Nevertheless, from 2023, the amount of new space introduced annually is expected to recover; the amount ofstock may even expand. A key task for rental office companies will be accurately identifying the trends behindthe current relocation/expansion demand and taking appropriate measures in response, both at new andexisting buildings.
For further information, contact:
Keiji Kurokawa, Michihiro Yonehara
Strategic Business Planning Group, Office of the President
Mori Trust Co., Ltd. http://www.mori-trust.co.jp
Toranomon 2-chome Tower, 3-17 Toranomon 2-Chome, Minato-ku, Tokyo 105-0001 JAPAN1. Supply of large-scale office buildings
The amount of new space introduced in major office buildings in 2018 was 1,470,000 m2, the fourth-highest figure
recorded the past 20 years.
In 2019, the figure for new space in major buildings is expected to slow to 1,020,000 m2, on par with the past
20-year average of 1,080,000 m2. However, in 2020, this figure is expected to begin rising once again, with a figureof 1,790,000 m2, almost the same for 2012, the second-highest mark over the past 20 years.
The supply of new office space is projected to decline in 2021 (530,000 m2) and 2022 (550,000 m2) in reaction to
the preceding glut of new space, but should increase again in 2023, with a figure around 990,000 m2, close to theaverage for the recent past. (Chart 1-1)
Calculating shares of new office space in the 23 wards while looking separately at the three central wards andother wards suggests the share corresponding to the three central wards will continue to increase from 2019 to 2023,
reaching around 80% from 2021. (Chart 1-2)
In terms of supply trends by building scale, the share of supply of buildings with total floor space of 100,000 m2 or
more has increased significantly in recent years, exceeding 60% for 2019-2023. Average office floor space perbuilding was 43,000 m2 from 1999 to 2018, but should grow from 2019 to 2023 to 63,000 m2 per building. The trend
is toward ultra-large-scale buildings. (Chart 1-3)

【Chart 1-1】Supply trends for large-scale office buildings in Tokyo’s 23 wards

Number of
supply50

Office supply in completed buildings
Office supply in buildings under construction

43

29
22
(10,000㎡)
250

27

26

29

29

Number of supply

32

30
22

27
21

20

19

16

14

21 19

22

23

23

20

18

11

221

179

Supply volume

162

0

89

90

82

'99 '00 '01 '02 '03

82

99

53

55

30%
(540,000㎡)

43%
25%(140,000㎡/year) (230,000㎡/year)'04−'0834%(180,000㎡/year)24%42%(130,000㎡/year) (230,000㎡/year)30%(160,000㎡/year)32%(180,000㎡/year)'09−'13'22

80%(440,000㎡)

20%(110,000㎡)'14−'18'23

82%(810,000㎡)

18%(180,000㎡)'19−'23

Tokyo’s three central wards

Other wards'20 '21 '22

32%(170,000㎡/year)

21%(110,000㎡)

75%

'19

'99−'0379%(420,000㎡)

50%'12 '13 '14 '15 '16 '17 '18'23【Chart 1-3】 Supply and ratio bybuilding scale

'21

25%

102
76

66

'04 '05 '06 '07 '08 '09 '10 '11

43%(440,000㎡)

70%(1,250,000㎡)

0%

99

36

57%
(580,000㎡)

'20

118
92

64

【Chart 1-2】 Tokyo’s three central wards
and other wards
'19

126

119

72
50

2019-2023 average supply:
980,000㎡/year

147

150
118

10
0

1999-2018 average supply:
1,080,000㎡/year
181

100

11

10

200

118

40

Office supply in buildings to be constructed

36

100%

0%

52%
(280,000㎡/year)24%
24%(130,000㎡/year) (130,000㎡/year)

63%(310,000㎡/year)

25%

Average area 1999-2018
43,000㎡/building

38%(210,000㎡/year)14%
23%(70,000㎡/year) (110,000㎡/year)

50%

75%

Average area 2019-2023
63,000㎡/building

100%

Buildings of 100,000㎡ or larger
Buildings of 50,000㎡ - 99,999㎡
Buildings of less than 50,000㎡

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 2019

2/8

2. Supply trends by area
Looking at trends by supply area, we see that the proportion of space accounted for by the three central wards
should remain around 70%. The share held by Minato Ward among the three central wards is projected to rise
sharply from 2019 to 2023. (Chart 2-1)
In terms of supply trends by district, the supply of new office space should be highest in Toranomon andShinbashi, which assume the top spot from Otemachi, Marunouchi, and Yurakucho. This is among the factors
accounting for the sharp increase in Minato Ward’s share. (Chart 2-2)
Outside the three central wards, the amount of new office space introduced is expected to remain relatively
constant in Shibuya Ward. Recent figures also attest to Shibuya’s recent emergence.

【Chart 2-1】Supply of large-scale office space by ward
[2014–2018][2019–2023]

Tokyo’s three central wards :3,990,000㎡ (75%)
Other wards : 1,330,000㎡ (25%)

Tokyo’s three central wards :3,500,000㎡ (72%)
Other wards : 1,380,000㎡ (28%)

Other wards
Koto 4%
2%
Shinagawa9%
Shibuya7%
Shinjuku
4%
Minato23%

Supply (10,000㎡)

Chiyoda37%

Chiyoda

196

Chuo

80

Minato123

Shinjuku

19

Shibuya36

Shinagawa

46

Koto

11

Others

22

Chuo
15%

Koto
6%
Shinagawa2%

Supply (10,000㎡)
ChiyodaOther wards
6%43

Minato204

Shinjuku

23

Shibuya46

Shinagawa

10

Chiyoda21%

Shibuya
9%

Chuo
9%

Shinjuku
5%

103

Chuo

Minato
42%

Koto

30

Others30【Chart 2-2】Top ten districts(10,000㎡)
70[2014–2018]

144
(27%)

2014
2015
2016
2017
2018

Supply volume

60
50

58
(11%)

40

44
(8%)

30

36
(7%)

26
(5%)

21
(4%)

20
(4%)

19
(4%)

20

16
(3%)

14
(3%)

Shibaura
KaiganSendagaya
Jingumae

10
0

Yaesu
OtemachiMarunouchi Nihonbashi
Yurakucho Kyobashi(10,000㎡)
70

Akasaka
Roppongi

128
(26%)

Toranomon Kojimachi
Shibuya
Shinbashi Hirakawacho
KioichoKonan[2019–2023]
2019
2020
2021
2022
2023
2022

71
(15%)

60

Supply volume

Osaki
Gotanda

50

42
(9%)

40

33
(7%)

30
(6%)

29
(6%)

30

21
(4%)

15
(3%)

12
(3%)

11
(2%)

20
10
0

Rank

Toranomon Otemachi
Shinbashi Marunouchi
Yurakucho( ) for previous
timeframe

1（2）

2（1）

Shibuya

Shibaura
KaiganToyosu

3（5）

4（3）

5（6）

Shiba
Mita
6（−）

Muromachi Ikebukuro Iwamotocho
Yaesu
Higashikanda
Nihonbashi Honcho
Sotokanda
Kyobashi
7（4）

8（8）

9（10）

10（−）

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 2018

3/8

【Chart 2-3】Supply volume in the key business districts[2014–2018]

Iidabashi
Kudan
Fujimi

IchigayaKojimachi
Hirakawacho
Kioicho Otemachi
Marunouchi
Yurakucho

Muromachi
HonchoYaesu
Nihonbashi
KyobashiChiyoda Ward

Sendagaya
Jingumae

Chuo Ward
Akasaka
Roppongi

Toranomon
Shinbashi

ShibuyaToyosuShiba Park
Hamamatsucho

Minato Ward

Shibaura
KaiganApprox.supply volume
Konan：500,000㎡〜：300,000㎡〜500,000㎡

Osaki
Gotanda：200,000㎡〜300,000㎡：100,000㎡〜200,000㎡[2019–2023]
Ikebukuro

Iwamotocho
Higashikanda
Sotokanda
Nishishinjuku

Yotsuya
Shinanomachi

Chiyoda Ward
OtemachiMarunouchi
Yurakucho

Muromachi
HonchoYaesu
Nihonbashi
Kyobashi

Chuo Ward
Toranomon
Shinbashi

ShibuyaToyosuMinato Ward
Shiba
Mita
Shibaura
KaiganApprox.supply volume：500,000㎡〜：300,000㎡〜500,000㎡：200,000㎡〜300,000㎡

Osaki
Gotanda：100,000㎡〜200,000㎡

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 2019

4/8

3. Supply trends by type of development site
In the three central wards, “Rebuilding” had previously accounted for the majority of total new space. In recent
years, however, office space in “Undeveloped/underdeveloped land : Redevelopment, etc.” has grown. Over the five
years from 2019 to 2023, office space created on “Undeveloped/underdeveloped land : Redevelopment, etc.” isexpected to account for more than 50% of all new office space. Outside the three central wards, new office space on“Undeveloped/underdeveloped land : Redevelopment, etc.” is projected to maintain a share exceeding 70%. (Chart
3-1)
Buildings on “Undeveloped/underdeveloped land : Redevelopment, etc.” is becoming the major source for new
office space in the 23 wards.

【Chart3-1】Supply volume and ratio by land for development[Other wards][Tokyo’s three central wards](10,000㎡)(10,000㎡)

400

400

350

350
92
(23%)

300

44
(14%)

300

196
(56%)

Supply volume

Supply volume

250
200
266
(86%)

150

307
(77%)

155
(44%)

100
50
0

250
200
185
(79%)

150
100

104
(75%)

95
(71%)

50

2009-20132014-20182019-2023

0

50
(21%)

2009-2013

38
(29%)

2014-2018

34
(25%)

2019-2023

Undeveloped/underdeveloped land :Redevelopment, etc.
Rebuilding[Definitions]Rebuilding:Land (or the development of such land) previously used as one site, occupied by a building for office, hotel, or
residence which has been demolished.

Undeveloped/underdeveloped land: Land for highly effective use (or development of such land), including development of clusters of small buildings;
land (or the development of such land) not used effectively; for instance, mixed zones of parking lots and older
buildings, densely populated residential areas, former plant sites, railway sites, or idle land.

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 2019

5/8

4. Supply trends for mid-size office buildings in Tokyo’s 23 wards
This section discusses supply trends in mid-size office buildings containing from 5,000 m2 to less than 10,000 m2.
The figure for new office space in mid-scale office buildings in 2018 was 129,000 m2. This exceeds the figure forthe year before but falls short of the average for the past ten years (132,000 m2). Figures for 2019 and 2020 are also
projected to fall short of the average for the recent past, as the mid-scale office space sector trends downward.
(Chart 4-1)
By ward in 2019 and 2020, Minato Ward is projected to hold the highest share, 40%. The districts with the highest
shares are projected to be Toranomon and Shinbashi. As with office space in major new office buildings, Minato
Ward accounts for the most new office space by ward, while Toranomon and Shinbashi account for the highest
figures by district. (Chart 4-2)
Trends in shares of new office space by ward show the share corresponding to the three central wards exceeds
70%, which has been the case every year since 2015. Trends for mid-scale office buildings in the central threewords are also projected to remain unchanged. (Chart 4-3 on following page)
Office space in rebuilt buildings (“Rebuilding”) is the main source of new space in mid-scale office buildings in the
23 wards overall, a trend distinct from the trend for large-scale office buildings, for which construction on“Undeveloped/underdeveloped land” is the main category. (Chart 4-4 on following page)The trend in which major developers are expanding their presence in mid-scale office building projects remains
unchanged. (Chart 4-5 on following page)【Chart4-1】Supply trends for mid-size officebuildings in Tokyo’s 23 wards【Chart4-2】Supply of mid-size buildings:
Ratio by ward and top three districts

Office supply in completed buildings
Office supply in buildings under construction
Office supply in buildings to be constructed
Number of supply

23

30

22

22
19

17
16

13

11

10
0

2009-2018 average supply:
132,000㎡/year

20.0 19.5

Supply volume16

12(10,000㎡)

15.0

20

13

Number of supply

27[2019–2020]

Koto
4%

Other wards
11%
Chiyoda10%

Shibuya
7%

Chuo
23%

Shinjuku
7%
Minato39%

15.5

15.4 15.3
13.1

12.9

10.0

Tokyo’s three central wards :120,000㎡ (71%)

11.3

11.2

9.1

8.4

9.4
7.4

Other wards :48,000㎡(29%)
Top three districts

5.0

.0

'09 '10 '11'12 '13 '14

'15

'16

'17

SupplyToranomon•Shinbashi

31,000㎡

Yaesu•Nihonbashi•Kyobashi

26,000㎡

Akasaka•Roppongi

16,000㎡'18 '19 '20

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 20196/8

【Chart4-3】Supply of mid-size buildings: Ratio by ward and top three districts[2015–2016][2017–2018][2019–2020]
Other wards
11%
Koto
4%
Shibuya7%

Other wards
Koto
5%
5%

Koto
6%

Shibuya2%

Other wards
16%
Chiyoda19%

Shinjuku
18%

Chuo
13%

Shibuya7%

Minato10%

Minato39%

Chiyoda27%

Chiyoda10%

Shinjuku
7%
Chuo
23%

Chuo
33%

Minato
39%

Tokyo’s three central wards :139,000㎡ (71%)

Tokyo’s three central wards :154,000㎡ (70%)

Tokyo’s three central wards :120,000㎡ (71%)

Other wards :58,000㎡ (29%)

Other wards :66,000㎡ (30%)

Other wards :48,000㎡ (29%)

Top three districts

SupplyTop three districts

Top three districts

SupplySupplyToranomon•Shinbashi

63,000㎡

Kayabacho•Hacchobori•Shinkawa 40,000㎡

Toranomon•Shinbashi

31,000㎡

Other

34,000㎡

Muromachi•Honcho

28,000㎡

Yaesu•Nihonbashi•Kyobashi

26,000㎡

Uchikanda•Kandasudacho

15,000㎡

Shinjuku

26,000㎡

Akasaka•Roppongi

16,000㎡【Chart4-4】Supply of mid-size buildings: Ratio by type of development site (2018-19)[Three central wards][Other wards]

Undevelopedor
Underdeveloped
land
14%

Undevelopedor
Underdeveloped
land
25%
Rebuilding
75%

Rebuilding
86%【Chart4-5】Supply of mid-size buildings: Ratio developed by major developers*[2009–2013]

Major
developers
27%•43,000㎡/year

Others73%•114,000㎡/year[2014–2018]

Major
developers
30%•32,000㎡/year

Others70%•74,000㎡/year[2019–2020]

Major
developers
35%•30,000㎡/year
Others65%•54,000㎡/year* Major developers: General developers with paid-in capital of 10.0 billion yen or more

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 2019

7/8

5. Conclusion
New office space in 2018 exceeded the average for the recent past by around 40%, but almost all new large-scale
office buildings had zero vacancies. With this rampant demand for office space, buildings scheduled for completionin 2019 have already largely completed tenant recruiting, buildings to be finished in 2020, when the amount of new
office space introduced is expected to be at the third-highest level ever, are also already attracting tenants.
New office building supply in 2021 and 2022 will tighten to around half the average for the recent past. Some of
the buildings scheduled for completion in 2021 already have tenants lined up, so the new office building market will
likely continue to be firm. In addition, vacancies in existing buildings from tenants relocating to new buildings(secondary vacancies) are also steadily being filled due to currently robust expansion demand. The existing officebuilding market is also projected to continue to maintain its strength.
At the same time, in 2023, the amount of new office space introduced is expected to recover to a level equivalent
to the average for the recent past and the reactionary decline following major supply is also expected to subside.
In considering the office market going forward in connection with office floor space (stock), in 2017, stock began
to rise in all three central wards for the first time since 2012, a span of five years. As indicated in supply trends byland for development seen above, the main category of land for large-scale office building supply is changing from
“Rebuilding” to “Undeveloped/underdeveloped land” resulting in increased stock, and the increase in stock, which
has been gradual to this point, calls for further monitoring going forward.
Fears concerning a deteriorating supply-demand balance due to the influx of new space for three years beginningin 2018 proved unfounded. Nevertheless, from 2023, the amount of new space introduced annually is expected torecover; the amount of stock may even expand. A key task for rental office companies will be accurately identifying
the trends in office improvements to secure talented personnel, trends in diversifying work locations underpinned bywork style reforms, and trends in seeking offices to increase productivity and creativity, the backdrop to current
trends in relocation/expansion demand, and to take measures to accommodate these trends at both new andexisting buildings to stimulate further demand and maintain the strength of the market.

【Chart 5-1】Office stock in Tokyo’s three central wards

Minato Ward
Chuo Ward
Chiyoda Ward

Office space(10,000㎡)
5,000
4,000

3,982

3,798

4,459

4,713

4,606

3,294

3,000
2,000
1,000
0

'93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17
Source: Compiled by Mori Trust based on “An Overview of Tokyo’s Land” (Tokyo Metropolitan Government)【Chart 5-2】Growth of office stockThree central wards
Chiyoda Ward
Chuo Ward
Minato Ward

(%)

12%

Growth rate

10%
8%
6%
4%
2%
0%
-2%

'93 '94 '95 '96 '97 '98 '99'00 '01'02 '03'04 '05 '06 '07'08 '09 '10'11 '12 '13 '14 '15 '16'17

Source: Compiled by Mori Trust based on “An Overview of Tokyo’s Land” (Tokyo Metropolitan Government)

Survey of Large-Scale Office Building Supply in Tokyo’s 23 Wards 20198/8