Tokyo：The period saw weaker leasing demand due to the adverse effects of COVID-19. However, some luxury brands remain upbeat about opening stores in prime locations. As a result, Tokyo prime rents were unchanged at JPY 400,000 (tsubo/month) for the 19th consecutive quarter. However, store demand among retailers is generally subdued due to decrease in inbound demand and deterioration of domestic consumption. As a result, Ginza high streets rents fell by 2.2% q-o-q (*1) to JPY 252,200 (tsubo/month) in Q2 2020.
*1 The previous quarter refers to Q4 2019 as CBRE did not compile prime rents in Q1 2020 as the spread of COVID-19 made it difficult to draw up rent estimates owing to a sharp drop in lease contracts.
Osaka：The period saw no new store openings by drugstores - previously the drivers of prime rental growth - due to a sharp drop in inbound demand. This led to a 16.6% q-o-q fall in Osaka prime rents to JPY 250,000 (tsubo/month) compared with the previous quarter. Meanwhile, a property in Midosuji on the high street received an application, in line with the asking rent, from a showroom-style store.
Nagoya：Demand from drugstores weakened also in Sakae in Nagoya, causing a 14.3% q-o-q fall in Nagoya prime rents to JPY 120,000 (tsubo/month). At a property on Otsu-dori in the high street area, a retailer that already has a stand-alone store in the Sakae area opened its second store in line with the landlord’s asking rent.