Reading the Japan Office Market: The Neutral Vacancy Rate Explained

As of Q1 2026, vacancy rates vary widely throughout Japan, ranging from as low as 1.2% to as high as 12.1%. With rents continuing to trend generally upward, this suggests that the vacancy rate level that divides a market with falling rents from one with rising rents (the “neutral vacancy rate”) differs from city to city. CBRE’s use of historical data to calculate neutral vacancy rates for each city reveals a wide disparity, with Tokyo generally falling within the 4-6% bracket. Vacancy rates are projected to remain below the neutral vacancy rate among all cities, leading CBRE to predict that rents will continue to rise across all markets.