Xymax Real Estate Institute

RESEARCH REPORT

Metropolitan Areas Office Demand Survey Spring
2019
Capturing the changing trend of office demandJune 26, 2019

In the past several years, companies have been promoting workstyle reforms aiming at securing of personnel
and improvement of productivity, with more companies introducing the flexible workstyles that are notconstrained by place or time rather than the conventional, fixed ones. These trends are likely to have quantitativeand qualitative effects on office demand.
Since autumn 2016, Xymax Real Estate Institute (hereinafter, "Xymax REI") has conducted surveys oncompanies' use of offices and workstyles on a semi-annual basis and has continuously analyzed their relationshipwith office demand. This report covers the results of the sixth survey.

(Related surveys:)
・Autumn 2016 (1st survey) Metropolitan Areas Office Demand Survey 2016 – Demand Trends, published January 12, 2017https://www.xymax.co.jp/english/research/images/pdf/20170112.pdf
・Autumn 2016 (1st survey) Metropolitan Areas Office Demand Survey 2016 – New Ways of Working and Office, published
January 30, 2017https://www.xymax.co.jp/english/research/images/pdf/20170130.pdf
・Spring 2017 (2nd survey) Metropolitan Areas Office Demand Survey 2017 – Demand Trends, published August 2, 2017https://www.xymax.co.jp/english/research/images/pdf/20170802_2.pdf
・Autumn 2017 (3rd survey) Metropolitan Areas Office Demand Survey Autumn 2017, published December 7, 2017https://www.xymax.co.jp/english/research/images/pdf/20171207.pdf
・Spring 2018 (4th survey) Metropolitan Areas Office Demand Survey Spring 2018, published July 3, 2018https://www.xymax.co.jp/english/research/images/pdf/20180703.pdf
・Autumn 2018 (5th survey) Metropolitan Areas Office Demand Survey Autumn 2018, published December 18, 2018https://www.xymax.co.jp/english/research/images/pdf/20181218.pdf

Summary of Survey Results
1.

Change in office demand (April 2018-March 2019) (Pages 3-14)

38.3% of the companies experienced an increase in the number of office users over the
past year, outnumbering the companies that experienced a decrease (13.6%). 8.6% of
the companies expanded their office space, while 3.1% reduced it. Also, the percentage(20.9%) of the companies that experienced an increase in their rent per tsubo (incl.
CAM) exceeded that (0.7%) of the companies experiencing a decrease, and has been
rising every half year. Thus, office demand was robust. (Figures 1, 2, and 3)


Rent per tsubo tended to increase in every office location, with the highest percentage of thecompanies answered that they experienced an “increase” in Fukuoka City. Among the companies
that had no changes in their office size, 18.4% reported “increased” rent per tsubo.



By company size, the percentage of the large companies (with 1,000 or more employees) thatexperienced an increase of rent per tsubo was highest. By industry, the construction industry
experienced increases of both office size and rent per tsubo, while the financial and insurance
industries indicated a tendency of reducing their office size.

More than half of the companies answered that they intended to decrease the percentage of theMetropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institutenumber of seats in the number of office users to 100% or less in future (51.1%, the sum of “less than100%” and “100%”). More companies providing “less than 100%” seats tended to introduce flexible
work areas than the companies providing “more than 100%” seats.


38.8% of the total companies thought their current office was not large enough. For the percentageof the companies that felt their office was small, there was no significant difference between those
providing “100%” seats for their office users and those providing “less than 100%” seats.



As for business confidence, the percentage of the companies answering it was “bad” or “relatively
bad” increased from our past surveys.

2.

Diversification of workplaces (Pages 15-20)

In terms of the layout of the current office, more companies are introducing spacesthat can be used flexibly with no restriction of usage. More companies are also providing
places and programs for telework, indicating that efforts to provide alternative
workplaces are progressing both in and outside the office. (Figures 17 and 18)Compared to the past surveys, the companies tended to increase their introduction of the spaces
for flexible usages, such as space for refreshing and hot-desking.

Regarding the initiatives to provide places and programs for telework, the rates of the companies
that offered “work-from-home programs” (21.2%) and “use of serviced offices, shared offices, etc.”(9.2%) were highest since the start of our survey.

The companies that reduced their office size tended to decrease fixed spaces such as fixed desk
space and meeting rooms and to increase flexible spaces, whereby they may intend to improve theiroffice space efficiency.

3.

Outlook of office demand (Pages 21-27)

The percentage of the companies that answered that the number of their office users“will increase” (41.5%) exceeded that of those answering it “will decrease” (4.9%). Also,
the percentage of those wanting to expand their office size (23.9%) exceeded that ofthose wanting to reduce (4.6%). Thus, office demand will remain robust. (Figures 23 and24)

By company size, the middle-sized companies (100-999 employees) indicated a stronger intention
to expand their office size in future. By industry, the telecommunications industry showed a stronger
office demand both in the past year and future.



The top of the major focuses in implementing office strategy was “productivity improvement”(56.2%). The result suggests that the companies tended to place a greater focus on the issues related
to employee satisfaction than those related to cost consciousness. As for the concerns and obstacles,
the issues related to cost dominated the top 3: Approximately 40% of the companies chose “heavy
cost burden,” which was followed by “risk of rise in rent levels.”

The office space per person at the companies introducing a flexible layout such as ABW and/or atelework-support effort including use of serviced offices/shared offices was smaller than that at thecompanies not introducing these initiatives.

4.

Topic: Future office strategy (Pages 28-30)

In terms of future office strategies, the top answer regarding the head office was toconcentrate in the center of Tokyo where good accessibility is secured (62.8%). On theother hand, the top answers regarding the offices other than the head office were to

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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RESEARCH REPORT｜Xymax Real Estate Instituteenhance work from home (49.3%) and to provide workspaces in various locations outside
the head office (39.5%), both exceeding the strategy of consolidating offices into thehead office as much as possible (33.3%). (Figures 33 and 34)
We believe that while head offices for “congregating” purposes will remain in demand,
there will be more alternative workplaces as companies’ awareness changes.

1. Change in office demand (April 2018-March 2019)
1-1.

Changes in the number of office users, size of office, and rent per tsubo (incl. CAM)



More companies saw an increase in the number of users (38.3%) than a decrease (13.6%).

More companies expanded their office space (8.6%) than those that reduced (3.1%).

More companies experienced a rise in rent per tsubo (incl. CAM charges) (20.9%) than a decline(0.7%).

The changes in the number of office users, office size, and rent per tsubo (including CAM charges; the same
applies hereafter) over the past year (April 2018-March 2019) were as below:
The percentage of the companies that experienced an increase in the number of office users far outnumberedthat of the companies that experienced a decrease by 24.7 percentage points (Figure 1, bottom bar). Also, thepercentage of the companies that expanded their office space exceeded that of the companies that reduced itby 5.5 percentage points (Figure 2, bottom bar). The percentage of the companies that saw an increase in rent
per tsubo outstripped that of the companies that saw a decrease by 20.2 percentage points (Figure 3, bottom
bar).
This trend has been almost consistent with the past five surveys (Autumn 2016, Spring 2017, Autumn 2017,
Spring 2018, and Autumn 2018), with the percentage of the companies that experienced a rise in rent per tsubo
increasing every half year.
Figure 1: Change in the Number of Office Users (Replies of all respondents)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
Figure 2: Change in the Office Size

(Replies of all respondents)

Figure 3: Change in Rent per Tsubo(Replies of all respondents)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
Next, we look at changes in the number of office users and the office size by the office location, although nosignificant differences were observed. However, when looking at change in rent per tsubo by the office location,
we found that more companies tended to answer that they experienced an “increase” of rent per tsubo in every
city (Figure 4). In Fukuoka City, in particular, the highest percentage (33.3%) of the companies experienced anincrease of rent per tsubo. In no cities except the Tokyo 23 Wards, there were the companies that reported a“decrease” in rent per tsubo. The tendency suggests that steady office demand is spreading into the regional
cities.
Figure 4: Change in Rent per Tsubo by the Office Location(Replies of all respondents, data of the major locations only)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute

PICK UP
Relationship between the Number of Seats vs. the Number of Office Users and theInitiative for the Work Area
We asked the companies about the percentage of the number of seats prepared currently in the number
of office users, and about to what percentage they would like to increase/decrease the number of seats infuture. When their answers were grouped into 3 levels – “less than 100%,” “100%,” and “more than 100%,”
the result revealed a gap between their current status and ideal.
As for the number of seats currently prepared, the majority (68.1%) of the companies provided thenumber of seats that accounted for “more than 100%” of the number of office users (Figure 5). However,when their current status and intention for future was compared, the percentage of the companies that
had an intention to provide “more than 100%” seats decreased by 27.1 percentage points, whereas that ofthose intending to provide “less than 100%” or “100%” seats increased. The result revealed that more thanhalf of the companies (51.1%, the sum of “less than 100%” and “100%”) had an intention to limit their
number of seats to 100% or less in future.
In addition, we compared the companies currently providing “less than 100%” seats and those providing“more than 100%” seats with regard to their initiatives for flexible office layouts and telework (Figure 6).
As the result, more companies providing ”less than 100%” seats were introducing most of the initiatives
than those providing ”more than 100%.” While no significant difference is found between the two groups
in terms of the introduction of open meeting space and work-from-home program, there are large
differences in hot-desking and space for refreshing. Thus, the companies preparing smaller number of seats
are shown to have made a range of innovative efforts for both inside of the office and out-of-office work
area.

Figure 5: The Number of Seats vs. the Number of Office Users– Current Status and Intention for Future(Replies of all respondents (n=1,278))

Metropolitan Areas Office Demand Survey Spring 2019
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Figure 6: Companies’ Initiatives for the Work Area, by the Percentage of the Number of Seats in the
Number of Office Users(Replies of all respondents, excerpted (n=1,278))

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute1-2. Change in the office size (in detail)The top two styles of office size expansion were “relocation” (43.6%) and “expanded area in thesame building” (27.3%). The top reason for expansion was “our office space became too small due
to increased personnel” (60.0%).

The most common style of office size reduction was “reduced area in the same building” (42.5%)that outnumbered “relocation” (37.5%). The most common two reasons for reduction were “toreduce office costs” and “to improve office space efficiency” (43.6%).

In terms of the style of office size expansion, the most companies expanded their office by relocating toanother building (43.6%), which followed by “expanded area in the same building” (27.3%). The percentage of“new opening” increased from the past survey results (Figure 7). As for the style of office size reduction, thepercentage of “reduced area in the same building” increased and outnumbered that of “relocation” (Figure 8).
Figure 7: Style of Office Size Expansion

Figure 8: Style of Office Size Reduction(The companies that expanded office size,
multiple answers,excerpted)(The companies that reduced office size,
multiple answers)*1 Sub-office: An office located near the main office such as the headquarters for separating some of its functions.
*2 New opening: Opening a new office within the same building in which the company is located.

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
The top reasons for office size expansion included “our office space became too small due to increased
personnel” (60.0%) and “to respond to personnel increase due to future intensified hiring efforts” (40.9%), whichindicates the companies’ positive stance toward securing personnel, while the percentage of “our office spacebecame too small due to increased personnel” decreased from that in our Sprint 2018 survey. The third reason
was “to enhance comfortability in the office environment” (32.7%), which suggests a rising interest in the impact
of offices on working people (Figure 9).
The top two reasons for office size reduction were “to reduce office costs” (43.6%) and “to improve officespace efficiency” (43.6%) (Figure 10). Given the percentage of “cost reduction” decreasing and that of “efficiency”
increasing year by year, it seems that more companies tend to reduce their office size on account of office space
efficiency.
Figure 9: Reason for Office Size Expansion(The companies that expanded office size, multiple answers)

Figure 10: Reason for Office Size Reduction(The companies that reduced office size, multiple answers)*3 No data for Spring 2017, since this option was added from the Spring 2018 survey.

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute1-3. Actual and potential change in the office sizeA substantial number of the companies had a potential to change their office size even though they
did not right now. Approximately 10% of all the companies were considering expansion, or had
considered but cancelled or suspended the plan.

9.8% of the companies that experienced “no change” in their office size over the past year were either“considering expansion” or “had considered expansion but cancelled or suspended the plan,” indicating thatthey had a potential to expand. Combined with the percentage of the companies that actually expanded theiroffice size, the percentage of actual and potential expansion amounts to 18.4% (Figure 11).
1.7% of the companies were “considering reduction” and 0.1% “had considered reduction but cancelled orsuspended the plan.” Combined with the percentage of the companies that actually reduced their office size,
the percentage of actual and potential reduction amounts to 4.9%.
Figure 11: Actual and Potential Change in Office Size over the Past Year
(Replies of all respondents (n=1,278), excerpted)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute1-4. Change in rent per tsubo (in detail)

42.7% of the companies that expanded their office size and 42.5% of the companies that reduced itexperienced an increase in rent per tsubo.



18.4% of the companies that had no change in their office size experienced an increase in rent per
tsubo.

Among the companies that expanded and reduced their office size, the percentage of those answering that
their rent per tsubo “increased” exceeded significantly that of those answering “decreased” rent per tsubo(Figure 12). Also, among the companies that had no changes in their office size, the percentage of those thatexperienced “increased” rent per tsubo (18.4%) exceeded that of those that experienced “decreased” rent per
tsubo (0.3%) by 18.1. The results indicate that rents are on a rising trend overall not only in newly-signed lease
but also in existing lease.

Figure 12: Change in Office Size and Rent per Tsubo(Replies of all respondents)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
PICK UP
Changes in Office Size and Rent per Tsubo by Company Profile
There were differences in the changes in office size and rent per tsubo by company size, industry, andoffice location.
Figure 13 shows the “Office Size Diffusion Index (DI)” – the change in office size (the percentage of“expanded” minus that of “reduced”), and the “Rent per Tsubo DI” – the change in rent per tsubo (thepercentage of “increase” in rent per tsubo minus the percentage of “decrease”) over the past year (April
2018-March 2019). From this report, Fukuoka City was added to the survey.
▲By company size (number of employees)
For the companies with 1,000 or more employees, Office Size DI was lower but Rent DI was highest.
On the other hand, for the companies with less than 100 employees, Office Size DI was higher but Rent
DI was lower.
◆By industry
The construction industry showed higher Office Size DI and Rent DI than other industries. The
telecommunications industry followed the construction industry in terms of the percentage of thecompanies that expanded their office size. For the financial and insurance industries, Rent DI was higher,
but the percentage of the companies that reduced their office size exceeded that of those expanded
their office size, which resulted in negative Office Size DI found solely among all the industries.
●By office location
Fukuoka City indicated highest Office Size DI and Rent DI exceeding those for The Tokyo 23 Wards.
Osaka City showed lower Office Size DI, and Nagoya City had highest Rent DI.
Figure 13: Office Size DI and Rent DI (Both Indicate Changes in the Past)(Excerpt of major industries and office locations only)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute1-5. Impression of office size and business confidence

38.8% of the companies felt that their current office was small.



While the business confidence among 29.5% of the companies was either “good” or “relatively good,”
23.9% of the companies answered that it was “bad” or “relatively bad.”

When we asked how the companies felt about their current office size, 38.8% of them in total answered thatthey felt their office was “very small” or “relatively small.” The percentage exceeded that of the companies that
felt their office was “very large” or “modestly large” (15.0%), indicating a potential need for expansion of office(Figure 14). When the results were compared with those of the past five surveys, the percentage of thecompanies that felt their office was small increased from Autumn 2017 to Spring 2018, and has been keeping
on the same level since then.

Figure 14: Impression of Office Size

(Replies of all respondents)

When we look at the companies’ impression of office size by the rate of the number of seats prepared in thenumber of office users (Figure 5), there was no significant difference in the percentage of the companies that
felt their office was small between those providing “100%” seats and those providing “less than 100%” seats(Figure 15). Moreover, the percentage of those that felt their office was large was higher in the companies
providing “less than 100%” seats than those providing “100%” seats. As mentioned above, higher percentage ofthe companies providing smaller number of seats relative to the number of office users prepared their work
areas that allowed flexible workstyle. Such efforts may help them improving their impression of office size whileaiming for office space efficiency.

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute

Figure 15: Impression of Office Size, by the Rate of the Number of Seats Prepared in the Number of
Office Users (Replies of all respondents)

As for business confidence, “Business Confidence DI” is presented in Figure 16 as the difference of the total
percentage of “good” and “relatively good” minus that of “bad” and “relatively bad.” In this survey, while 29.5%of the companies answered business confidence was “good” or “relatively good,” 23.9% answered it was “bad”
or “relatively bad:” The DI was lowest (5.6) among the surveys we have conducted.
Figure 16: Business Confidence DI(Replies of all respondents, excerpted)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute

2. Diversification of Workplaces2-1. Office layoutAlthough no major difference was seen compared to the past survey, there is a slightly rising trend
in the spaces for flexible usages, such as space for refreshing and hot-desking.

Figure 17 (lower bar) indicates what the companies’ current offices have.
Although no major difference was seen compared to the past surveys, the spaces that allow flexible usages
to meet users’ needs (e.g. “space for refreshing” and “hot-desking”) tend to increase slightly.

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
Figure 17: Layout of Current Office(Replies of all respondents, multiple answers, excerpted)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute2-2. Initiatives to support telework“Development and use of work-from-home programs” was the most popular answer (21.2%), while“use of serviced offices, shared offices, etc. (*1)“ also increased.

About the companies’ initiatives to support telework, we asked them if they offered or prepared any, even if
such initiatives were only for the part of their people.
“Development and use of work-from-home programs” was the most popular answer (21.2%). Comparison
with the past surveys shows that “use of serviced office or shared office provided by a specialized operator“ (9.2%) tends to increase (Figure 18). These results suggest that alternative workplaces are gradually(*1)

becoming available following the recent prevalence of workstyle reforms.
Figure 18: Types of Places and Programs for Telework(Replies of all respondents, multiple answers, excerpted)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
The initiatives to support telework varied depending on the attributes of the companies, such as company
size and location.
By company size (number of employees), the large companies with 1,000 or more employees showed highest
percentages of availability regarding all the initiatives such as “work-from-home program” (37.9%) and “use ofserviced offices, shared offices, etc.” (19.6%) (Figure 19).
Figure 19: Availability of Places/Programs for Telework – By Company Size(% in brackets: Spring 2018 survey) (Multiple answers)

By office location, the Tokyo 23 Wards tended to show higher percentages of availability for all the initiatives(Figure 20).
Figure 20: Availability of Places/Programs for Telework – By Office Location(% in brackets: Spring 2018 survey) (Excerpt of major location, multiple answers)

Metropolitan Areas Office Demand Survey Spring 2019
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RESEARCH REPORT｜Xymax Real Estate Institute
By industry, telecommunications and service industries tended to show higher percentage of availability(Figure 21).

Figure 21: Availability of Places/Programs for Telework – By Industry(% in brackets: Spring 2018 survey) (Excerpt of major industries, multiple answers)

Metropolitan Areas Office Demand Survey Spring 2019
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PICK UP
Change in Office Layout by Change in Office Size
In this survey, we asked the companies about the change of their office layout over the past year (April
2018-March 2019) that was categorized into the 3 types: fixed desk space, meeting rooms, and flexible
space (*). Next, we examined the relationship between the change in the size of each layout type and thechange in the size of the company’s entire office (Figure 22).
The result revealed that the companies expanding their entire office size tended to increase the size of
every layout type at the same time.
Among the companies reducing their entire office size, the percentage of those “increased flexible space”
was highest (27.5%), whereas the percentages of those increased fixed desks and those increased meetingrooms were 2.5% and 10.0%, respectively. In addition, 70% of the companies reducing their entire officesize decreased the fixed desk space. It seems that the companies reducing their entire office size intend to
improve their office space efficiency by reducing the spaces of fixed location and usage like fixed desks
and meeting rooms, while increasing flexible spaces such as hot-desking and open meeting space.

Figure 22: Change in Office Layout by Change in Office Size
(Replies of all respondents, excerpted)

Metropolitan Areas Office Demand Survey Spring 2019
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3. Outlook of Office Demand
3-1. Outlook of the number of office users and the office size

41.5% of the companies answered that the number of their office users “will increase,” significantly
exceeding that of those answering it “will decrease” (4.9%).

Also, 23.9% of the companies answered that they wanted to expand their office size, exceeding that ofthose answering they wanted to reduce the office (4.6%). Thus, the strong demand for office space islikely to continue.

We asked the companies about their expectations of the number of users of their current office in the next
one to two years. 41.5% of the companies answered that the number of users “will increase,” significantly
exceeding that of those answering “will decrease” (4.9%) (Figure 23). Likewise, in terms of the companies’
intention toward their office size for the next two to three years, more companies wanted to expand (23.9%)
than to reduce (4.6%) (Figure 24). Thus, the result of this survey indicates the strong demand for office spaceis likely to continue, like the result shown in the Spring 2018 survey.

Figure 23: Change in the Future Number of Office Users

Figure 24: Intention for Future Office Size

(Replies of all respondents)(Replies of all respondents)

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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RESEARCH REPORT｜Xymax Real Estate InstituteRegarding the styles of expansion asked among the companies that “want to expand” their office size, the top
answers were “expanded area in the same building” (45.2%) and “relocation” (44.2%) (Figure 25). The top threereasons for future expansion were same as those answered by the companies that had already expanded: “ouroffice space became too small due to increased personnel” (63.6%), “to respond to personnel increase due tofuture intensified hiring efforts” (48.5%), and “to enhance comfortability in the office environment” (37.4%)(Figure 27). When the result was compared with those of the past surveys, we found that the percentage of “tomotivate employees” tended to increase.
As for the styles of office size reduction, the top answer was “relocation” (47.5%), like the Spring 2018 survey(Figure 26). The reasons for future reduction included “to reduce office costs” (64.4%) and “to improve officespace efficiency” (49.2%) (Figure 28).

Figure 25: Style of Future Expansion(Companies wanting to expand office size, multiple answers)

Figure 26: Style of Future Reduction(Companies wanting to reduce office size, multiple answers)*1 New opening: Opening a new office in the building different from the one in which the company is located.
*2

Sub-office: An office located near the main office such as the headquarters for separating some of its
functions.

*3 The data of “Don't know, not yet decided” for Spring 2017 survey is not consistent with our past reports,
since this report excluded the contradictory answers.

Metropolitan Areas Office Demand Survey Spring 2019
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report
may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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RESEARCH REPORT｜Xymax Real Estate Institute

Figure 27: Reason for Future Expansion

Figure 28: Reason for Future Reduction(Companies wanting to expand office size, multiple answers)(Companies wanting to reduce office size, multiple answers)

Metropolitan Areas Office Demand Survey Spring 201923

The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report
may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

RESEARCH REPORT｜Xymax Real Estate Institute

PICK UP
Past and Future Changes in Office Size by Company Profile
Figure 29 shows the Office Size DI (the percentage of “expanded” minus that of “reduced”) of the past
year (April 2018–March 2019) and the future Office Size Intention DI (the percentage of “want to expand”
minus the percentage of “want to reduce”).
▲ By company size (number of employees)
For the companies with 100–999 employees, the future Office Size Intention DI was higher. For thecompanies with 1,000 or more employees, both the future Office Size Intention DI and the Office Size DIof the past year were lower.
◆By industry
The result shows that office demand in the telecommunications industry was strong and is expected tobe so still in future. The service industry indicated highest future Office Size Intention DI. On the other
hand, in the financial and insurance industries, many companies reduced their office size in the past year
and showed lower future Office Size Intention DI.
● By office location
Fukuoka City indicated the strongest office demand both in the past year and for future. In Osaka City,
while expansion of office size was relatively low in the past, its future Office Size Intention DI was higher
than that for Nagoya City.
Figure 29: Office Size DI (Past and Future) (Excerpt of major industries and office locations only)

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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24

RESEARCH REPORT｜Xymax Real Estate Institute3-2. The major focuses, concerns, and obstacles in implementing office strategy

The major focuses of the companies in implementing their office strategy included “productivity
improvement” (56.2%), “enhancement of employees’ motivation” (50.8%), and “enhancement of
comfortability in the office environment” (37.5%): The issues related to employee satisfaction ranked
high.



As for concerns and obstacles in implementing office strategies, the issues related to cost dominatedthe top 3 rankings, which were followed by the issues concerning internal coordination such as “noapproval from the management” (14.8%) and “coordination with the systems department” (13.9%).

The major focuses of the companies in implementing their office strategy were shown in Figure 30. The
result suggests that the companies placed a greater focus on the issues related to employee satisfaction suchas “enhancement of employees’ motivation,” “more active communication,” and “enhancement of
comfortability in the office environment” than the issues related to cost consciousness that included“reduction of office costs,” “reduction of travel costs (time and transportation fee),” and “office space
reduction/efficiency.” It revealed that the companies had a greater awareness about providing a pleasantworking environment for their employees.
Figure 30: The Major Focuses in Implementing Office Strategy(Replies of all respondents (n=1,278), multiple answers)

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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RESEARCH REPORT｜Xymax Real Estate Institute
As for the concerns and obstacles in implementing office strategies, approximately 40% of the companies
chose “heavy cost burden” which was the top answer and “risk of rise in rent levels” (27.1%) came the next
(Figure 31). Following the issues related to cost, those related to internal coordination such as “no approval
from the management” (14.8%) and “coordination with the systems department” (13.9%) ranked higher.

Figure 31: Concerns and Obstacles in Implementing Office Strategy(Replies of all respondents (n=1,278), multiple answers)

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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RESEARCH REPORT｜Xymax Real Estate Institute

PICK UP
Office Space per Person by Initiative on Workplace
A calculation of office space per person (the median) by the availability of a flexible office layout or
telework indicates that in all layouts and types of telework, the companies where such layout or telework
is available have a smaller office space per person than the companies where such initiatives are notavailable (Figure 32).
The office space per person at the companies that had introduced a flexible layout, especially ABW,
was smaller than that at the companies not introducing such layouts by 1 tsubo or larger (1 tsubo = 3.3sqm). In terms of the place for telework, the office space per person at the companies that used serviced
or shared office and satellite office was 2.73 tsubo and 2.79 tsubo, respectively (3.80 tsubo and 3.77
tsubo, respectively, at companies that did not use such offices). The dispersion of workplaces may becontributing to improved efficiency of conventional office space. If workstyles continue to become more
flexible and diverse both in and outside the office, it may affect the use of fixed office space, such ashead offices, as well as office demand.
Figure 32: Office Space per Person by Availability of Initiative on Workplace (Median)(Replies of the companies with office space per person of 1.5–15 tsubo (n=1,173))

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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27

RESEARCH REPORT｜Xymax Real Estate Institute

4. Topic: Future Office Strategy
4-1. Future office strategy for head office and other officesAs the future strategy for the head office, the top answer was to “concentrate in the center of Tokyo
where good accessibility is secured” (62.8%, the sum of “Agree” and “Partly agree”). The results also
revealed that more than half of the companies intended to “measure/visualize the productivity ofoffices.”

As the future strategy for offices other than the head office, 49.3% of the companies chose “enhance
work from home” and 39.5% chose “provide workspaces in various locations outside the head
office.” The percentage for the both strategies outnumbered that for “consolidate offices into thehead office as much as possible” (33.3%).

We asked the companies about their strategy for the head office for 5–10 years ahead (Figure 33). The top
answer was to “concentrate in the center of Tokyo where good accessibility is secured” (62.8%, the sum of “Agree”
and “Partly agree”), followed by an intention to “measure/visualize the productivity of offices” by more than halfof the companies (52.1%).
Figure 33: Future Strategy for the Head Office(Replies of all respondents (n=1,278))

Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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RESEARCH REPORT｜Xymax Real Estate Institute
As for the future strategy for offices other than the head office, nearly half of the companies (49.3%)
answered that they would “enhance work from home” (Figure 34). Furthermore, 39.5% of the companies
answered that they would “provide workspaces in various places outside the head office,” exceeding thepercentage of the companies that would “consolidate offices into the head office as much as possible.” They
seem to have an intention to provide environment where their employees can work in various locations
outside the head office rather than to integrate their functions in the head office.
Figure 34: Future Strategy for Offices Other than the Head Office(Replies of all respondents (n=1,278))

5. Summary
As we have examined in 1-1. Changes in the number of office users, size of office, and rent per tsubo (Incl.
CAM charges), the increase exceeded the decrease in the number of office users, the size of office, and rent per
tsubo over the past year, indicating continued robust demand for offices. In particular, the percentage of thecompanies that reported “increase” of rent per tsubo increased not only in the Tokyo 23 Wards but also in theregional cities such as Fukuoka City and among the companies that reported no change in their office size. In
addition, as seen in 3-1. Outlook of the number of office users and the office size, more companies answeredthat the number of their office users “will increase” than “will decrease” as well as more companies wanted to
expand their office size than to reduce. Thus, the future demand for office space would be strong continuously.
On the other hand, the percentage of the companies that answered that business confidence was “bad” or“relatively bad” increased from our past surveys, which may suggest changes in the business climate surrounding
the companies.
In this survey, we asked the companies about the percentage of the number of seats prepared in the number
of office users, regarding their current situation and intention for future. As the result, more than half of thecompanies had an intention to limit their number of seats to 100% of the number of their office users or less infuture (Figure 5). In addition, more companies providing “less than 100%” seats introduced flexible officelayouts and telework than those providing “more than 100%” seats (Figure 6), which indicated that they may
try to improve their people’s impression of office size through these initiatives (Figure 15).
With regard to office layouts, more companies tend to provide the spaces for flexible usages such as spacefor refreshing and hot-desking. In addition, they are gradually introducing the places and programs for telework
such as the work-from-home program and serviced office (Figures 17 and 18). For the companies that had
reduced their entire office size, they tended to decrease the spaces of fixed location and usage like fixed desks
Metropolitan Areas Office Demand Survey Spring 2019
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may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

29

RESEARCH REPORT｜Xymax Real Estate Instituteand meeting rooms but to increase flexible spaces such as hot-desking and open meeting space, throughwhich they seem to aim for office space efficiency (Figure 22). In fact, the office space per person was smallerat the companies that had introduced a flexible office layout such as ABW and those utilizing serviced office orshared office. These efforts are likely to contribute to enhancement of office size efficiency (Figure 32). Whileavailability of work-from-home program and/or serviced office is getting higher, diversification of workplaces
must continue to affect future office demand.
As shown by the several results of this survey, the shift to more flexible workstyles without being bound to
the location is expected to accelerate future, and the workplaces would be dispersed everywhere accordingly.
On the other hand, as we saw in Figures 33 and 34, the head offices for “congregating” purposes will remain
in demand, even if changing their shape and/or role. We intend to observe continuously the quantitative
factors including the office size and the number of users, as well as the qualitative changes in office demand
due to the social factors such as workstyle reforms.

Metropolitan Areas Office Demand Survey Spring 2019
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report
may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

30

RESEARCH REPORT｜Xymax Real Estate Institute
Survey Overview
SurveyperiodApril-May, 2019

Targetrespondents

4,156 companies in total:・Companies that are tenants of office buildings managed by the Xymax Group・Client companies of XYMAX INFONISTA Corporation

No. of valid
responses

1,278 companies; response rate, 31%

Geographicalcoverage

Nationwide (Tokyo, Osaka, Aichi, Fukuoka, Kanagawa, Saitama, Chiba Prefectures and others)

SurveymethodBy email and questionnaire sheet
Current office
・ Office type, location, contracted area, rent per tsubo (incl. CAM charges), number of office users
・ Number of work desks, intention for the number work desks, impression of office size
Current status of office use and telework・ Current status of office layout, current status of places for telework
Change in office demand (April 2018-March 2019)
・ Change in the number of office users
・ Change in the office size, the details, and the reason
・ Change in rent per tsubo
Change in office layout (April 2018-March 2019)
・ Change in the fixed desk space and the reason
・ Change in the meeting rooms and the reason
・ Change in the flexible space, the details, and the reason

Topicscovered in thesurveyChange in workplaces for telework (April 2018-March 2019)
・ Change in the serviced office/shared office and the reason
・ Change in the satellite office and the reason
・ Change in the office located in the other company and the reason
・ Change in work-from-home program and the reason
Outlook of office demand・ The agenda the company focuses on and business confidence・ Outlook of change in the number of office users
・ Intention to change the office size, the details, and the reason
・ Major focuses, concerns, and obstacles in implementing office strategy
Future office strategy
・ Head office strategy, office strategy for other offices
Company profile
・ Industry, location of head office, number of employees, year of establishment
Respondent profile・ Department, position, age group

Metropolitan Areas Office Demand Survey Spring 2019
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report
may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
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31

RESEARCH REPORT｜Xymax Real Estate InstituteProfile of Respondent Companies (Upper row: percentage of total; Lower row: the number of companies)

・The percentage mix in the charts contained in this report are rounded to the first decimal place and therefore may not add
up to 100%.
・Figures 6, 18, 19, 20, 21, and 32 are excerpts of the main places and programs for telework or the office layouts.

Contact for inquiries concerning this report
Xymax Real Estate Institutehttps://soken.xymax.co.jp

E-MAIL: info-rei@xymax.co.jp

Metropolitan Areas Office Demand Survey Spring 2019
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report
may not be reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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