CBRE Korea: Near-Zero Vacancy Rates in Tokyo’s Prime Retail Districts Make Early-Stage Location Strategy Critical for K-Brands Entering Japan

- “Retail Insights Note Vol. 2 Tokyo” analyzes five key Tokyo retail districts by drawing parallels with major retail markets in Seoul
- Presents execution strategies spanning market and location selection, landlord screening, off-market opportunities and lease risk management

September 15, 2026 (Seoul) – CBRE Korea, the world's largest commercial real estate services company, announced the publication of CBRE Korea Retail Insights Note Vol. 2 Tokyo. According to the report, competition for locations in Tokyo’s key retail districts is intensifying as the continued expansion of K-brands into Japan coincides with near-zero vacancy rates and record-high rents. The report advises brands seeking to enter Tokyo successfully to develop an integrated strategy from the outset, aligning market selection, property sourcing and lease terms with their positioning and the intended purpose of each store.

The report identifies Japanese consumer spending in Seoul’s major retail districts and Japan’s substantial inbound tourism demand as key factors supporting K-brands’ expansion into Tokyo. Over the past year, estimated spending by Japanese consumers across seven major retail districts in Seoul reached approximately KRW 610 billion, accounting for 12.7% of total spending by foreign consumers. With Japan welcoming 42.68 million international visitors in 2025, physical stores in Tokyo are increasingly viewed as strategic hubs through which K-brands can target both domestic Japanese consumers and global tourists.

Following the first edition of the Retail Insights Note, which focused on Seongsu, the latest report draws on the characteristics of Seoul’s major retail districts to examine five key Tokyo markets—Shibuya, Harajuku, Omotesando, Ginza and Shinjuku—and recommends suitable brand profiles and market-entry strategies for each.

The report describes Shibuya as combining Myeongdong’s high foot traffic with Seongsu’s ability to generate buzz, while Harajuku brings together Hongdae’s youth culture and Seongsu’s vibrant pop-up ecosystem. Omotesando is positioned as a high-end district combining Hannam’s sophisticated sensibility with Dosan’s flagship-store function, while Ginza blends Cheongdam’s luxury positioning with Dosan’s role as a flagship destination. Much like Gangnam, Shinjuku leverages extensive transport connectivity and large-scale commercial facilities to convert high foot traffic into sales. As customer profiles and store functions vary significantly across Tokyo’s retail districts, the report emphasizes the importance of selecting a market that aligns with a brand’s positioning and expansion objectives.

Even after identifying the right market, however, securing a suitable location in Tokyo’s key retail districts remains challenging. Vacancy rates across Tokyo’s major retail markets stand at just 0.0%–0.1%, effectively leaving no available space. Prime rents have reached record highs of JPY 298,000 per tsubo—approximately 3.3 sq. m.—per month in Ginza and JPY 252,000 in Omotesando and Harajuku. As availability along prime high streets declines, leasing demand is expanding into secondary streets and properties scheduled for redevelopment. Some global retailers are also considering building acquisitions, in addition to leasing, to secure long-term footholds in the market.

In such a highly competitive environment, identifying a suitable store alone is not enough. The report stresses that brand positioning and store-opening execution must be planned in tandem, highlighting three core strategies: selecting markets and locations aligned with brand objectives; demonstrating brand competitiveness and creditworthiness during landlord screening; and sourcing off-market opportunities while managing lease-related risks. Given Japan-specific leasing practices, including reinstatement obligations that may require tenants to completely strip out all interior fixtures and finishes, the report underscores the importance of working from an early stage with an experienced partner that has both local market intelligence and established landlord networks.

Ryan Kim, Head of Retail, CBRE Korea, said, “As K-brands continue to gain global recognition, Japan is emerging as a key overseas expansion market for Korean retailers. With each Tokyo retail district serving a distinct customer base and store function, success requires more than a general understanding of the market. Brands need a strategy that identifies the right location from the outset and translates that decision into an actual store opening. We hope this Retail Insights Note will serve as a practical guide for Korean retailers seeking to develop a more concrete strategy for entering Tokyo.”

The full CBRE Korea Retail Insights Note Vol. 2 Tokyo is available on the CBRE Korea Retail Insights website.