Vacancy rates in the regional office markets are either recording new lows (e.g. Sapporo and Fukuoka) or are fast approaching new lows.
CBRE forecasts that net absorption between 2016 and 2020 will average 192,000 tsubo per year in Tokyo, and 55,000 tsubo per year in the regional cities. As a result, the vacancy rate in Tokyo is expected to rise as new supply will exceed new demand. On the other hand, in the regional cities, vacancy rates are expected to fall further as new demand will exceed new supply. Some cities already record vacancy rates lower than Tokyo, but going forward, it is highly likely this will be true for the aggregate vacancy rate of the regional cities.