Japan Real Estate Market Quarterly Review-Second Quarter 2023

Financial Research Department Watanabe Fumiko 

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Macro Economy
  • Japan’s real GDP is expected to increased by +0.8% q-o-q (annualized 3.1% increase) in Q2 2023, bolstered by robust exports in both goods and services.
  • Japan’s real GDP is expected to expand by 1.0% in FY2023, and 1.6% in FY2024.

Real Estate Market
  • The office market's stability remains uncertain amid increasing new supply.
  • Tokyo multifamily are seeing renewed acceleration.
  • Retail sales rebounds, supported by solid consumption of inbound tourists.
  • Population inflow to Tokyo approaching to pre-COVID levels.
  • The hotel market anticipates complete recovery as Chinese group travels return.
  • In Greater Tokyo logistics markets, vacancy rates remain elevated due to large supply.

Capital Market
  • J-REIT Index increased by 4.3% q-o-q in Q2 2023, trading at a price to NAV ratio of 0.93x, dividend yield at 4.1%, and dividend and JGB spread at 3.7% in June 2023.
  • J-REITs acquired property assets totaling JPY240 billion in Q2 2023 (115% increase 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.

Financial Research Department  

Watanabe Fumiko

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