Office relocation stops, due to COVID19

some big companies have stopped their scheduled office relocation in greater Tokyo area.

The reasons why companies cancel their office relocations are as follows;

1 Uncertainty for future

A hotel brand, Toyoko Inn has cancelled their office relocation. Some other hotel operator mentioned, they should look at how JPs government organize the Olympic game in 2021. They held the scheduled volume, no audiences, or limited number of audiences, all those future outlook has still been uncertain.

2 Remote work transition

COVID-19 allowed companies to be aware that most of the work processes can be done remotely. Companies started making a good use of this condition. People can use their private spaces as work place. Thus, the office layout and spaces which used to be prevailing in the market have no more the trend.

3 To take the bottom rent in the market

Tenants have been aware of the rents’ decrease. When the rental value hit the bottom of the market cycle, they want to shift their offices and enjoy the benefit.

Therefore, for the next couple of years, we may be able to expect some rental value decrease and to evidence the tenant market.

Companies who cancelled their office relocation are manufacturing, hotels, financial institutions and other IT companies. The trend would spread into other sectors as well.

Further queries or doubts, please email to ytomizuka@abrilsjp.com

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