Japan Real Estate Market Quarterly Review-First Quarter 2022

Financial Research Department Economic Research Department Researcher Hiroto Iwasa

Macro Economy

Japan’s real GDP is expected to decline by 0.5% q-o-q (annualized 2.1% decline) in Q1 2022, dragged by the quasi-state of emergency and a decrease in net export.
Japan’s real GDP is expected to expand by 2.1%, revised downward by 0.4% from the previous forecast due to Russia's invasion of Ukraine

Real Estate Market

In the Tokyo Grade-A office market, vacancy rates remained flat, but rents continue to fall amidst the concerns over large supply in 2023.
Multifamily rents in Tokyo declined modestly in single-type but rose in family-type.
Recovery in hotels and retails remained stagnant, weighed by a quasi-state of emergency.
In Greater Tokyo logistics markets, the supply-demand balance started to ease.

Capital Market

J-REIT Index declined by 3.1% q-o-q in Q1 2022, trading at a price to NAV ratio of 1.06x, dividend yield at 3.7%, and dividend and JGB spread at 3.5%.
J-REITs acquired property assets totaling JPY360 billion in Q1 2022 (19% decrease y-o-y).

This report includes data from various sources and NLI Research Institute does not guarantee the accuracy and reliability. In addition, this report is intended only for providing information, and the opinions and forecasts are not intended to make or break any contracts.