Tiffany Ginza building asking price cut by a third as real estate market cools
The owner of the building has struggled to find buyers with an asking price of ¥120 billion, and is now open to offers as low as ¥80 billion.
Tiffany & Co.'s flagship store in Tokyo's prestigious Ginza district has seen its asking price for the 25-acre building cut by a third. The once lofty figure of ¥120 billion ($760 million) has been reduced to ¥80 billion, signaling a cooling of Japan's real estate market.
The property, owned by Kurosawa Group, has been languishing on the market for months. Kurosawa Group's reluctance to bargain may be linked to the challenges they face in finding a buyer amidst the current economic climate. Rising interest rates and inflation have made the allure of real estate investment less enticing, as fixed rents in long-term leases like Tiffany's reduce the potential for rent increases.
The lease, a 25-year fixed agreement between Tiffany and the Ginza building owner, has proven to be a deterrent for potential buyers. In this environment, the ability to adjust rents is a key factor that makes real estate more appealing, according to people familiar with the situation.
Despite the reduced asking price, Tiffany, which is part of the luxury conglomerate LVMH Moet Hennessy Louis Vuitton, remains in place, benefiting from the long-term lease.
Written by urgent.news from Japan Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
