CBRE data indicates that commercial real estate investment volume in Japan decreased 57% year-on-year to JPY 660.0 billion during Q4 2023, reflecting both an exceptionally high base year – during which Otemachi Place changed hands for JPY 440.0 billion – as well as 78% year-on-year decline in foreign investment, due to overseas investors maintaining their cautious approach since mid-2023.

CBRE reports that by asset type, residential sector investments saw the greatest annual increase at 50% to JPY 187.0 billion; an acquisition by a J-REIT for totalling JPY 46.9 billion was particularly influential. Retail also witnessed substantial investment growth at 48% to JPY 115.0 billion.

Full-year 2023 investment volume decreased by 3% year over year due to a 28% drop in foreign investments and office transaction volume declining 43% year-on-year.

CBRE’s survey of investors in Japan indicates a weakening purchasing appetite among investors, with plans to increase acquisition volume declining 6 pp. year over year while sales volume increases increased 9 pp. This indicates a weakened buying appetite among investors.