Kurosawa slashes Ginza Tiffany tower price by one-third as Japan real estate cools

Kurosawa Group, the privately held owner of the glass-fronted 13-storey tower in Tokyo’s Ginza that hosts Tiffany & Co’s largest Asian boutique, has slashed its sale price from 120 billion yen to as low as 80 billion yen after months of limited interest. The building, which includes a private salon, VIP lounges and Japan’s first Tiffany café, is leased to Tiffany on a 25-year fixed-rent contract, a factor that deters investors seeking to raise rents in an environment of inflation above 2 percent since 2022.

The price reduction mirrors a broader cooling of Japan’s commercial real-estate market, where higher borrowing costs, a weak yen and the Bank of Japan’s fastest rate hikes since 1990 have compressed returns on prime Tokyo properties to record lows, according to CBRE. Although Kurosawa is not in urgent need of cash and may still abandon the sale, the adjustment highlights the challenges facing investors in fixed-lease assets.

LVMH, Tiffany’s parent, declined to comment. The shift signals growing caution among buyers amid Japan’s inflationary pressures and tighter monetary policy.