The resident population in Tokyo’s three central wards of Minato, Chiyoda and Chuo is expected to increase 34 percent from 2015 to 2045 (from 443,000 people to 595,000) as wealthy families and older retirees return to the city center, stated the Tokyo Metropolitan Government. This represents a decline, however, after an estimated increase to 630,000 people by 2040. Certain outer regions of the greater Tokyo market may see population declines starting in 2025.
Population growth in Tokyo’s Chuo ward has been so expansive in recent years the district intends to do away with floor area ratio (FAR) allowances to curb that growth, and ease the strain being placed on school and transportation resources, according to Japan Property Central.
“The removal of the allowance is expected to have a big impact on small- to medium-sized apartment projects,” noted Japan Property Central. “Their profitability will be severely limited, resulting in fewer developers choosing to build smaller buildings of less than 100 units. Hotels and commercial facilities, however, are expected to see further allowances to encourage additional development.”
Introduced in 1993, the FAR allowance encouraged apartment development to help increase the ward’s residential population, which had declined to 70,000 in the 1990s from a peak of 170,000 in the 1950s as families moved outside Tokyo’s city center to suburban towns — a common theme at the time, now being played in reverse.
