Fukuoka
• Record highnetabsorptiondriven bylargenewsupply
• Thevacancyraterisesto7%,withimpactfrommajornewsupply.
• Rentalgrowth accelerateasnewsupplyentersmarket.
IntheDecember 2024Kyushu-OkinawaTankansurvey,theDIfor businessconditions foralllargeenterprises improved by1point from September to26.TheDIformanufacturing was19(up1point), while theDIfornon-manufacturing was32(unchanged). Netabsorptionin 4Q24exceeded 41,000sqm,thelargestrecorded inasinglequarter sinceJLLstartedtracking.Absorption inthesignificantnewsupply wasthemainfactor.Thefigureforfullyear2024exceeded 57,000 sqm,againthehighestfiguresinceJLLstartedmonitoring.
Newsupplyin4Q24exceeded 53,000sqm, increasingthestockby 12%q-o-q and15%y-o-y. OneFukuokaBuilding(NLA49,000sqm) andHulicSquare FukuokaTenjin (NLA4,200sqm)were completed. Thevacancyratewas7.0%,up1.8pointsq-o-q, markingthefifth consecutive quarterofincreasewithgrowthaccelerating fromthe previous quarter. Thevacancy raterosesignificantlyintheTenjin, AkasakaandYakuinareasduetovacanciesfrom newsupply,whileit fellinotherareasduetofirmdemand.
Fundamentals
Rentsin4Q24averaged JPY20,853pertsubo,per month, up3.1%qo-qand4.4%y-o-y. Theincreasewasdriven byhigherrentsfornew supplyintheTenjin, AkasakaandYakuinareas,andagradualrise wasalsoseenintheHakataStationareaonthebackoffirmdemand. Capitalvaluesroseby2.5%q-o-q and4.5%y-o-y. Asinvestment yieldsremained flat,therisereflected higherrents.NocasesofGrade Aofficetransactionswereobserved during thequarter.
Outlook
According toOxfordEconomics, GDPgrowth isexpected to accelerate to0.9%in2025.Risksinclude theimpactofoverseas economic andpricetrends ontheFukuokaeconomy.
Going forward, newsupplyisexpected tooutstripdemand inthe FukuokaGradeAoffice rentalmarket,andvacancy ratesareexpected torise,puttingdownward pressureonrents.Intheinvestment market,investment yieldsareexpected toremainflat,butpricesmay decline moderately, reflecting weakerrents.
Note: FinancialandphysicalindicatorsareforFukuoka’sGradeAofficemarket. DataisonaNLAbasis.
FukuokaOffice
MarketDynamics Q42024
JonesLangLaSalleK.K.
Tokyo Headquarters
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Kansai
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Yodoyabashi Building 3-5-29KitahamaChuo-ku, Osaka541-0041
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Fukuoka
DaihakataBldg. 2-20-1Hakata-ekimae, Hakata-ku,Fukuoka-shi
Fukuoka812-0011
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Nagoya
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+81528563357
Formoreinformation,pleasecontact
YutoOhigashi
Senior Director
Research-Japan
yuto.ohigashi@jll.com
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