Commercial Property in Tokyo
Office or Commercial Property in Tokyo
Whether renewing a lease, relocating an office, or seeking to design a consistent strategy to acquire space and accommodate a multi-site expansion, you need a commercial tenant representative that knows Japan and the real estate market here. We serve as your strategic adviser, lowering your real estate costs and occupancy risks while maximizing workplace flexibility and productivity. We’ll analyze your business drivers and occupancy needs, identify and evaluate appropriate options, and manage lease negotiations.
We will act as your on-call expert for all your commercial leasing and lease administration needs. Our commercial real estate consultant is Andrew Stevens. Andrew has many years of experience in Japan in the commercial real estate industry, and is as one of the most experienced and knowledgeable foreigners in the commercial leasing field in Japan. Andrew`s market knowledge, expertise and market leading know how help our clients navigate the often grey commercial real estate market to their best possible outcome.
The Tenant Representation Approach
As brokers represent both owners and tenants and are paid a fee from each, this is contradiction in terms from a tenant representative`s approach as the broker will favor the landlord through the transaction. Our team represents our tenant clients exclusively – not the landlord-, thereby focusing services dedicated to fulfill tenant clients’ needs and providing the best result.
Local Market Practices in Tokyo
Lease Terms, Two Types:
- Traditional 2 years perpetual or ‘Standard’ Japanese lease
- Fixed term lease, usually 3 or 5 years
Fixed term lease currently preferred by most landlords of Grade A offices but prevailing market conditions can impact on lease flexibility
- Traditional Lease structure gives tenant automatic right to terminate (usually on 6 months notice) and security of tenure (Section 28 of House & Lease Law)
- Fixed terms do not contain a right to terminate but landlords are becoming more flexible to include break clauses etc. via negotiation on a case-by-case basis.
- Under traditional lease to ‘lease renewal rate’, but no valuation formula and usually a blend of contract and market rate.
- No automatic right to renew under fixed term lease. Re-contract required to market rent levels.
- Up to 12 months headline rent, typically paid in cash without interest
- Tenant required to restore to original condition at expiry.
- Regular office estimate ￥100,000 – ￥150,000 per tsubo (US$30-45 per sq ft)
- Tenants are usually required to use the landlords nominated contractor for majority of the build-out work.
- Regular office estimate cost ￥400,000 – ￥600,000 per tsubo (US$ 120-180 per sq ft)
- Sub leases very rare but tenants may typically share with group companies
- Space Standards
Domestic Companies: 2～4 tsubo (70～140 sf) / person
Multi National Corporations: 3～5 tsubo (100-180 sf) / person
※1 Tsubo = 3.3058 sq m = 35.58 sq ft
- Operating since 1993
- A team of 6 real estate professionals
- Bilingual staff
- Second to none market knowledge and best practice
Full range of occupier services
- Tenant representation
- Lease and transaction management
- Rent reviews and renewals
- Retail strategy consulting and advisory
- Market entry consulting
- Fit out and project management capability via network of trusted vendors
Andrew has 10 years experience in the commercial real estate industry in Japan. After working with a local brokerage and then joining the world`s leading international real estate firm, he is one of the most experienced and knowledgeable foreigners in the commercial leasing field in Japan, with experience with a wide spectrum of industries and project sizes from market entries to large, complex, multi-floor transactions. Andrew recently completed 350 sq.m lease acquisition for Vitra Japan, a 720 sq.m lease acquisition for Happy Elements Asia Pacific and a 500 sq.m lease acquisition for Apex K.K.
Andrew’s team is supported by Japanese staff Satoshi Fujiwara, Takeshi Watanabe and Yuichiro Matsushige.
- We pride ourselves in providing the same level of service and expertise to local and smaller Multinational corporations as provided to large Multinationals by top tier International real estate service providers.
- We represent and negotiate for the client 100%. We are completely unbiased regarding Landlords and are never paid by Landlords. We provide full, unbiased access to the market. We can access any available space country wide.
- Our bilingual representatives provide advice and assistance in English to guide clients generally unfamiliar with the Japanese market through the sometimes unique process of leasing a commercial space in Japan as smoothly as possible.
- We give the client peace-of-mind by providing control through continuous communication, consultation and transparency.
- We make the property sourcing process as smooth and efficient as possible by understanding the client’s business, needs and intended outcome, avoiding wasting client’s time by showing inappropriate properties.
- We work closely with office fit out vendors to provide business continuity and project time efficiency to provide clients with peace of mind that their office relocation is running smoothly.
- At the close of each project, a Client Satisfaction Survey is completed by the client representative(s). The questions within this survey relate, not just to the transaction and negotiation, but to the complete service that was offered to the client.Scores are rated from 1 (poor) to 5 (excellent). Where possible we look to gear an element of our fee to our performance on the Survey, so that the client determines the level of our fee.