Tokyo
• LimitedNewSupply DrivesVacancyRateDown to8.8%
• Rents Continue toRise,Reflecting HigherConstruction Costs
• Investment Demand Remains Solid, Supporting FurtherPriceGrowth
Demandfrome-commercecompaniesandthird-partylogistics(3PL)operatorsremainedrobust,withnewdemandreaching221,000sqminQ42025.Although demandhadsoftenedinperipheralareasduetohighertransportationcostsstemmingfromtheongoingshortageoftruckdrivers,lowerrentallevelsinthese locationsarenowbeingviewedmorefavourablybysometenants,indicatingearlysignsofrecoveryintenantdemand.
Newsupplytotalledjustonefacility(85,000sqm)thisquarter thefirstsingle-buildingcompletionineightyears,sinceQ42017.Withdemandcontinuingto outpacesupply,theGreaterTokyovacancyratedeclinedforthesecondconsecutivequarterto8.8%,representinga0.3ppdecreasequarter-on-quarter(q-o-q) anda0.7ppdeclineyear-on-year(y-o-y).
TheaveragemonthlyrentinGreaterTokyorosetoJPY4,780pertsubo,increasing1.2%q-o-q and2.0%y-o-y. Thesharpriseinconstructioncostshasledto higherrentsfornewlycompletedproperties,whichinturnisexertingupwardpressureonrentsinsurroundingexistingfacilities.
JLL’sestimatedcapitalvalueforlogisticsfacilitiesinGreaterTokyoincreased0.2%q-o-q and0.8%y-o-y, reflectingrentalgrowth.Althoughlong-terminterest rateshavecontinuedtorise,compressingyieldmargins,strongunderlyingdemandhassustainedpricingmomentum.Thelargesttransactionbyvaluethis quarterwasBlackstoneGroup’sacquisitionofalarge-scalelogisticsfacilityinTokyo’sKotoWard.
Outlook
Stabledemandfrome-commerceand3PLoccupiers,combinedwithrestrictednewdevelopmentduetorisingconstructioncosts,isexpectedtosustainupward pressureonrentsacrosstheGreaterTokyomarket.However,peripheralareas,wherevacancyratesarecomparativelyhigherandtransportcostsareincreasing, arelikelytoexperienceonlymodestrentalgrowth.
AlthoughOxfordEconomicsforecastsfurtherinterestrateincreases,investmentappetitefrombothdomesticandinternationalinvestorsremainsstrong.Asa result,anycaprateexpansionisexpectedtobelimited,andcapitalvaluesareprojectedtocontinuerising,particularlyforassetsandsubmarketswithstrong rentalgrowthpotential.
Fundamentals
Note:TokyologisticsreferstotheGreaterTokyoprimelogisticsmarket.Dataisonan NLAbasis.
Historicalsupplyanddemandtrends
TokyoLogistics MarketDynamics Q42025
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Formoreinformation,pleasecontact
ManabuTaniguchi
Senior Director
Research-Japan manabu.taniguchi@jll.com
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