The socio-economic conditions of the 1980s and early 1990s brought about a high concentration of capital and decision-making functions in the central area of Tokyo. This trend led to a shortage of office spaces. To make up for this, a number of office building were constructed, but that has triggered social problems, for example an increase on office vacancies.
In examining those problems, viewing offices as facilities is important, but this view has not been fully considered in previous studies of office location in Japan. In addition, it is important to consider a change of the urban structure caused by the agglomeration of offices.
In this article, the author attempts to analyze the role of office supply in attracting office functions and promoting the growth of business districts in the Tokyo metropolitan area, by considering the trends in office development, office markets and the location of office functions in 1980s and early 1990s. The following summarizes the main results:
In this metropolitan area, many office spaces were constructed in the core area and the sub-core, though office development occourred in the suburbs too.
The construction of large office buildings requires ample funds and management ability, and such buildings have often been built in specific areas: the core, the sub-core and in some of the peripheral wards. They were developed by joint enterprises of private developers and the public sector. The trend in office facilities was changed by the emerqence of high technology buildings, smart-buildings, in the mid 1980s. Office facilities have had high value added and have differentiated more and more.
Office markets are measured by rental fees and the rental ratio. The level of rental fees was affected by the increase of‘smart-buildings’, Furthermore, land values caused rises in fees during the time of the most overheated real estate markets. In the late 1980s and early 1990s, the time of the bubble economy, there was a regional difference in the level of rental fees. The highest level was in the Marunouchi-Ohtemachi district in the core, and lower in the sub-core, peripheral wards, and peripheral cities respectively. But this difference has been abolished since the collapse of the boom. On the other hand, the trend in the rental ratio of office spaces has not been the same trend as fees. Those ratios have declined at the areas where many large buildings were constructed. Otherwise, some of peripheral cities have maintained high rates. Those cities have stable office demand and a better balance of demand and supply than the core.
The accumulation of offices has been proceeding not only in the core and the subcore, but in the suburbs. This accumulation is more remarkable in the former. The growth of peripheral cities as business centers was covered up by the core and the subcore. The service sector, particular information service sector offices have increased remarkably. Offices spaces in the suburbs have been moved into by branch offices and back offices which have their headquarters in the core and need other smaller spaces, and the relocation of headquarters from the core to the suburbs was not dramatic. Office developers planed strategies of the targets of attracting branch offices and back offices, have contributed to the growth of peripheral cities.
From the view of office supply, the trends in office location in the metropolitan area fundamentally have been centripetal. The competition in office developments in the 1980s and early 1990s has promoted the growth of the core and the sub-core. On the other hand, peripheral cities have been growing slowly as business districts.
