Tokyo Sees Office Demand and Tourist Influx... Official Land Price Hits Highest Level Since 1993

Ministry of Land Releases 2026 Official Land Prices

Commercial Land Up 11.4% Year-on-Year

26.9% Surge Near Tourist Spot Sensoji

Land prices for commercial properties in Tokyo, Japan have surged by double digits, reaching their highest level since 1993. This jump is attributed to a combination of increased office demand following the COVID-19 pandemic, a rise in foreign tourists, and inflows of investment capital, all of which have led to more active real estate transactions in Tokyo.

On September 16, the Nihon Keizai Shimbun (Nikkei) reported that, based on an analysis of Japan's Ministry of Land, Infrastructure, Transport and Tourism's published 2026 official land prices, the average official price per square meter for commercial land in Tokyo has surpassed 3 million yen (2.64 million won). This marks the highest level in 33 years since it reached 4.18 million yen in 1993. The official land price is surveyed and announced by each local government as of July 1 each year, serving as a standard for private land transactions.

Azabudai Hills, a complex space located in Azabudai, Minato Ward, one of Tokyo's affluent neighborhoods. Azabudai Hills.

The official land price for commercial properties in Tokyo rose by 11.4% compared to the previous year. This marks the fifth consecutive year of increases, and the rate has expanded from last year's 11.2%. The main driver behind the rise in land prices is the increased demand for office space. After the pandemic, many companies switched their working styles from remote work back to in-office attendance, leading to a significant drop in vacancy rates. According to U.S. real estate firm Jones Lang LaSalle (JLL), as of the end of June, the average vacancy rate for large offices in Tokyo's five central wards (Chiyoda, Chuo, Minato, Shinjuku, Shibuya) was only 0.8%. Nikkei reported that this is far below the 5% level considered to reflect a balanced supply and demand in the market.

An increase in foreign tourists has also pushed up land prices in Tokyo. Among the 23 special wards of Tokyo, Daito-ku recorded the highest growth in the official land price for commercial properties, with a rate of 19.6%. This area is home to Asakusa Sensoji, which attracts many foreign tourists. At a survey point near Sensoji, the official price per square meter surged by 26.9% year-on-year to 4.9 million yen (4.312 million won), the highest increase within Tokyo.

The passage leading to Sensoji, a famous Buddhist temple in Asakusa, located in Daito Ward, Tokyo, Japan, is bustling with tourists coming and going. Tokyo (Japan)=AP Yonhap News.

Nikkei explained, "Last year, 28.65 million foreigners visited Tokyo, a 15.6% increase over the previous year and the highest ever. The rise in tourist numbers has expanded demand for hotels and stores, which in turn has led to higher land prices."

Residential land prices also rose. The official residential land price in Tokyo increased by 5.8% year-on-year, surpassing Okinawa Prefecture to record the highest growth rate in the nation for the first time in 12 years. According to the Japan Real Estate Institute, the average price for newly built condominiums in Tokyo's 23 wards exceeded 140 million yen (1.23457 billion won) for the January to June period this year.

Both domestic and international investment capital continues to flow in. According to global real estate services firm CBRE, real estate investment in Japan last year rose by 41.3% year-on-year to 7.0323 trillion yen (62 trillion won), the largest amount since the company began compiling statistics in 2005. Of this, residential sector investment reached 984.3 billion yen (8.6824 trillion won), up 86.2% from a year earlier. Nikkei added, "There is a growing trend of overseas funds entering the Japanese real estate market, such as a Canadian investment fund acquiring a portfolio of rental apartments in Tokyo and other major metropolitan areas in Japan."

This content was produced with the assistance of AI translation services.