Osaka
• Vacancyrate fallsdue toabsorption ofvacantspacewithout newsupply
• Strongdemand continues,with tenantsbeingsecured forproperties under construction
• Rentsexpected tocontinuerisingduetoincreasingconstructioncosts
In4Q2024,thestrong demand forlogisticsfacilitiesintheOsakaarea continued. Thenetabsorption ofexistingproperties was14,000sqm, andforthefullyear2024,itreached 699,957sqm.
Therewasno newsupplyin3Q,andthetotalstockareaincreased to 6,973,000sqm, up14%y-o-y. Asvacancy absorptionprogressed in existingproperties, thevacancy rateinGreaterOsakafellto2.8%, down 20bpsfromtheprevious quarteranddown 60bpsyear-onyear.Thevacancy rateintheOsakaBayarearemained unchanged qo-qat2.2%,whiletheinlandareafellby40bpsto3.5%.
Rent increased toJPY4,152pertsubopermonth, up0.2%q-o-q and 1.6%y-o-y. Existingproperty rentsarerising,following thehighrents ofnewly suppliedproperties.
Reflecting therentincreases,capitalvaluesforlogisticsfacilitiesin GreaterOsakacontinue on anupwardtrend.
Outlook
Anincreaseinnew supplyisexpected ininlandareasfrom2025 onward, whichislikelytoresultinariseinvacancyrates.However, duetostrong demand, tenants arealreadybeingsecured for properties underconstruction. Asaresult,theincreaseinvacancy ratesisexpected tobelimited, withthevacancy rateforGreater Osakapredicted toremainbetween 4-5%.Inparticular,properties withadvantages intermsoflocation, buildingspecifications andrent areexpected tohavehighoccupancy ratesupon completion.
Duetosoaringconstruction costs,rents fornewly constructed properties areexpected tocontinue rising.Existingproperties are alsolikelytoseerentincreases,driven bythetrends innew properties. Whilethereareconcerns abouttheabilityoftenants to bearhigherrents,existingproperties continue tomaintainhigh occupancy rates,suggesting thatrentincreasesarelikelytopersist.
Fundamentals
Note:OsakalogisticsreferstotheGreaterOsakaprimelogisticsmarket.Dataisonan NLAbasis.
Historicalsupplyanddemandtrends
OsakaLogistics MarketDynamics Q42024
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