In a recent report, real estate and investment firm CBRE labeled Yokohama City as “Japan’s Emerging R&D Hub.”
Reasons for this finding included the continuing emergence of large buildings suitable for research and development, the strong cost-to-benefit ratio and lower average rent when compared to Tokyo, and favorable and youth-driven job market. Factors such as these are attracting more and more IoT manufacturers and investors to Yokohama, setting the foundation for a strong business and investment market.
According to the report, corporate R&D has continued to increase rapidly since the global financial crisis in 2008, a phenomenon largely spurred by the popularization of “IoT” (Internet of Things) network-connected devices, and a corresponding demand has developed for the establishment and expansion of R&D centers and activity. This trend has especially manifested in Yokohama’s “Minato Mirai” waterfront business district due to a number of favorable incentives and conditions. The prefectural government and the city of Yokohama can provide a grant of up to 6 billion JPY to those building or acquiring R&D centers in Minato Mirai. In addition, IoT research centers do not require the same specific equipment and protected environment that other industry research might, which makes operating an IoT R&D center from one of Minato Mirai’s office buildings a viable and attractive option, and increases the ease of entry.
The number of office buildings and available office space continues to increase at a dramatic rate as well, with the increase in office building stock from new supply estimated at approximately 70,000 tsubo (231,000 m2). At 19% of the current total GFA, Yokohama’s is the highest ratio of future new supply to current stock in Japan, and strongly indicates the rate at which Minato Mirai and the city itself is developing and expanding. In addition, the cost-benefit of renting space in Yokohama was highlighted, with rent per unit of area being 50% cheaper on average than Tokyo.
In terms of recruitment, Yokohama’s younger, millennial population (25-34) numbers 430,000, which is second nationally only to the number of millennials across the total of all of Tokyo’s 23 wards. According to the report, the trend of work-life balance and a concern for commuting time indicates that this large millennial population would prefer to work in Yokohama, which in turn represents a strong recruitment opportunity for Yokohama-based companies.
For more detailed information and data, the full report is available to download now for free from the CBRE website: https://www.cbre.com/research-and-reports/Japan-Major-Report—Japans-Emerging-RD-Hub-Yokohama-Minato-Mirai