Japan Investment MarketView Q3 2025

Investment volume tops JPY 2 trillion, setting new quarterly record;
Year-to-date investment volume approaches JPY 5 trillion

• Japan commercial real estate investment volume increased by 68% y-o-y to JPY 2.092 trillion in Q3 2025, establishing a new quarterly record since CBRE’s surveys began in 2005. Large transactions in excess of JPY 10 billion doubled in volume from the same period of the previous year. Investment volume recorded double-digit percentage increases y-o-y for all sectors other than hotels, with office transactions expanding by 2.6x over the same quarter of the previous year. Hotel investment volume remained largely unchanged y-o-y but still recorded its fourth highest ever quarterly total.

• J-REIT acquisition volume for the quarter (all transactions, including those below JPY 1 billion) fell by 38% y-o-y to JPY 253.7 billion, with offices the most popular asset type for a third consecutive quarter. Sales volume surged to JPY 296.1 billion, 2.1x that of the same quarter in the previous year. Retail and logistics sales volume recorded all-time quarterly highs.

• Expected NOI yields for Tokyo prime assets remained unchanged for a 12th straight quarter for offices, slipped by 3 bps q-o-q for both logistics and hotels, and remained unchanged for retail and rental residential. The DI for “vacancy rate” in the logistics sector recorded a third consecutive quarter of improvement in CBRE’s latest Tankan Survey, indicating that investors’ sentiment is in line the leasing market outlook that logistics vacancy rates are likely to peak out.