This will be Tokyo’s biggest industrial project for 2024

It’s a 256,000sqm facility to be completed in the second half of the year.

Greater Tokyo experienced an influx of nearly 2.0 million sq m of GFA into the logistics market in 1H/2024, approximately 30% lower than the same period in 2023. According to data from Savills, the largest completion in the first half of 2024 was the Atsugi III Logistics Center, a multi-tenant logistics facility located in Kanagawa with a GFA of 182,000 sq m. 

The facility had reportedly secured five tenants upon completion, and began operations at full occupancy in May. Located near the Metropolitan Inter-City Expressway, which has access to the Tokyo Metropolitan Area, northern Kanto and western Japan, its accessibility will be even further improved when new connections via the Shin-Tomei Expressway are completed in 2027. 

Here’s more from Savills:

In the second half of 2024, the 256,000 sq m MFLP LOGIFRONT Tokyo-Itabashi will be the largest addition for 2024. Located in the 23W, this facility will be the first in the area to use its extensive site as a testing ground for drone flights, such as the delivery of goods in the final stage of the supply chain (last-mile delivery) and the transportation of relief supplies during emergencies. 

Overall, 2024 is expected to see approximately 3.2 million sq m of new logistics supply, about 25% lower than the peak in 2023. Additionally, lower supply levels are anticipated in subsequent years, driven by rising construction costs and labour shortages, which will further facilitate the absorption of existing elevated secondary vacancies. 

In Greater Osaka, the new supply forecast for 2024 has been revised down to just under 1 million sq m from 1.2 million sq m a year ago, due to rising construction costs and extended construction periods prompting developers to alter their development plans. The first half of 2024 accounted for 65% of the year’s supply, with the largest contributor being the LOGI’Q Minami-Ibaraki by Tokyu Land, adding 162,000 sq m to the market. 

In the second half of 2024, new supply is forecast to be relatively subdued, with only one completion larger than 100,000 sq m - the 165,000 sq m GLP ALFALINK Ibaraki 1. This should provide room for absorption for the rest of 2024. 

Looking ahead, 2025 will see a significant uptick in new logistics supply in Greater Osaka, approximately 1.8 million sq m, almost double the amounts seen in each of the two preceding years. The most notable upcoming completions in 2025 will be CPD Nishinomiya Kita I and II, with an aggregate GFA of 300,000 sq m. Located near the Chugoku and the Hanshin Expressways, this prime location offers excellent transportation access, supporting medium-to-long-term transport needs between Osaka and Kobe and should serve as a wide-area distribution hub for the Kansai, Chugoku and Shikoku regions. Given the much lower levels of existing stock in Greater Osaka, the limited supply is likely to stimulate demand, although it may cause temporary disruptions.