Tokyo
• Luxurygoods salesrecover growthtrend.
• Seiwa GinzaBuildingcompletes onChuo-doriinGinza.
• Rents andcapitalvaluescontinue growthtrend.
Fundamentals
Domesticconsumption remained stableduetorecovering income andsentiment. Luxurygoods salesresumedgrowth inSeptember, followed bytwoconsecutive months of20%y-o-y growth. Inbound consumption stayedstrong amidrecord foreign visitorarrivals.Notablenew openings inQ4included Loewe and LäderachonChuo-dori, andUGGonMatsuya-doriinGinza.InOmotesando, Diptyque opened alongside CatStreet.
NewsupplyinQ4included SeiwaGinzaBuilding, atwo-building redevelopment project thatalsofeaturesGinzaDai-IchiBldg(officebuilding). TheretailbuildingoffersaGFAof4,700sqmacross13above-ground floors,withLoeweoccupying fourstoreys.Theoutlineof Omotesando Grid Tower wasmade public.Theoffice-led mixed-usedevelopment, with38above-ground floors,willofferaGFAof46,000sqmuponcompletion in Q12026.Retailspacewillbeprovided on theground andbasementfloors withwithoccupiers including Salon23ku
Rents inQ4reached JPY104,154pertsubopermonth, increasing 1.9%q-o-q and5.5%y-o-y. Growthcontinued, albeitataslower pace, primarilybecausemajorbrandswithstrongrentaffordabilityhadcompleted theirexpansion cycle. CapitalvaluesinQ4increased 1.7%q-o-q and4.2%y-o-y, driven byrent growthamidstablecaprates.Notabletransactionsinthequarterincluded domestic realestatecorporation MantomiAssetManagement's acquisitionofGinzagCUBE(priceundisclosed).
Outlook
According toeconomic forecastsbyOxfordEconomics asofDecember, privateconsumption y-o-ygrowth wasrevisedupto1.2%in2025and 0.7%in2026.Risksincludetheimpact ofcontinued inflationon consumer sentiment. Rent growthisexpected tocontinue, driven bythetight demand-supply balancefrom independent international brandsandnear-fullycommitted futuresupply.Investment marketcapitalvalues shouldincreasegraduallyalongside rentgrowthwhilecapratesremainstable.
Note:FinancialindicatorsarefortheprimeretailmarketsofGinzaandOmotesando DataisonanNLAbasis.RetailsalesgrowthfiguresareforTokyoPrefecture.
LuxuryGoodsSales
Source:JapanDepartmentStoresAssociation
Note:Luxurygoodsrefertoart,jewellery,andprecious metals
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