Osaka
• Relocation demand driven bytalentconsiderations expanded fromlargecorporations tomid-sizedandsmallcompanies
• Thequartersawno newsupplyandcontinued take-upinexistingpremises.
• Rents reached JPY27,104pertsuboper month, up3.0%q-o-q and13.9%y-o-y
Osaka’sGradeAofficemarketstarted2026strongly, withnetabsorption totalling7,000tsuboinQ12026.Therewasnosignificantconcentration among tenantsthatrelocated, withawide rangeofsectorsrepresented, including long-establishedmanufacturers,wholesalersandIT companies.
Therewasno newsupplydelivered duringthequarter. YodoyabashiGateTower, whichcompleted lastquarterwithaGFAof40,000tsuboand 29storeys,hasmade steadyprogress inleasing.TheQ12026vacancy ratefellto2.2%,down 0.9ppbothq-o-q andy-o-y. Buildingscompleted after2024,whichpreviously hadavailablespace, arenowseeing theirtotalvacancysignificantlyreduced, indicating tightermarketconditions.
Theaveragemonthly grossrentpertsubowasJPY27,104,up3.0%q-o-q and13.9%y-o-y, markingthefirsttimeannualrental growthhas exceeded 13%sincetrackingbegan in2003.Risesinrents attop-tier buildingsaredriving theoverallincrease.Capitalvaluesrose2.9%q-o-q and14.6%y-o-yinQ1,driven byrisingrents.Notabletransactionsannounced inthequarterincluded MeijiYasudaLifeInsurance'sacquisition ofHulicOsakaBuilding.Thebuyerisplanning to rebuildtheacquired building.
Outlook
According toOxfordEconomics forecastsasofMarch2026,OsakaCity'srealGDPgrowthisprojected at+0.5%in2026.Thevacancy rateis expected tocontinue declining. Withfuturenewsupplyscheduled tobeextremely limited, theonly buildingdueforcompletion inJuly2026is notable. Tenant demand remains strong, anditisexpected tobefullyletshortlyaftercompletion. Therefore, thevacancyrateatendQ42026is forecasttodecline to2.0%.Vacanciesintop-tier buildingsaregetting scarceinearnest.Withavailablefloorspacebecoming limited, the upwardtrend inrents iscontinuing, andtheannualrentalgrowthratefor2026isprojected tobearound10%.
Fundamentals
YTDnet absorption
completions
Note:Financialandphysical indicatorsareforthe5KusGradeAofficemarket.Datais onanNLAbasis.
Historicalsupplyanddemandtrends
Tsubo(thousands)
Netabsorption Newsupply Vacancyrate
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