Older building to be converted into housing
The Tokyo Metropolitan Government announced on August 19 the first selected project under its Affordable Housing Supply Challenge through Renovation. Yasuda Real Estate will renovate an older mixed-use building in Kanda-Nishikicho, Chiyoda Ward, creating affordable residences alongside shops and other spaces open to the local community. The project demonstrates Tokyo's effort to use existing building stock rather than relying solely on demolition and new construction.
Rent benchmark set at 80% of comparable local rents
Tokyo states that rents for the affordable units will be calculated using 80% of rents for comparable nearby housing as a benchmark. Design or construction is scheduled to begin during fiscal 2026, with renovation expected to be completed during fiscal 2027. The metropolitan government plans to select up to three projects under the program and is continuing to accept applications until the planned number is reached.
A new model for central Tokyo rental supply
Tokyo rents are affected not only by location and building age but also by rising land, acquisition and construction costs. Converting existing buildings into residential use could supplement new construction and create additional options in central locations. One project will not materially alter Tokyo-wide rents, however. The policy's broader impact will depend on how many projects proceed, how many units they deliver and what eligibility and tenancy conditions apply.