Tiffany Japan building faces 30% price cut as debt costs rise

Published Wed, Oct 21, 2026 · 03:16 PM

[TOKYO] The Tokyo building home to Tiffany & Co’s largest boutique in Asia has slashed its asking price by a third after being on the market for months, reflecting a cooling of the Japanese real estate market amid rising interest rates and inflation. 

Kurosawa Group, the owner of the building in Tokyo’s glitzy Ginza area, has struggled to find interested buyers for several months with an asking price of 120 billion yen (US$760 million), according to people familiar with the matter who asked not to be identified discussing private matters.

The closely-held firm is now open to offers as low as 80 billion yen, the people added. 

Tiffany, part of LVMH Moët Hennessy Louis Vuitton, has a 25-year fixed lease for its space in the building, according to sales documents viewed by Bloomberg. The long lease with Tiffany at a fixed rent has deterred buyers in an inflationary environment where the appeal of buying real estate lies in the ability to raise rents, the sources informed. 

Kurosawa’s struggle also highlights deteriorating sentiment in Japan’s real estate market in recent months, with increased borrowing costs and inflation pressures squeezing returns and forcing buyers to get more selective. A weak yen and persistent inflation is also boosting anticipation for more rate hikes after the Bank of Japan raised interest rates at the fastest pace since 1990. 

The Tokyo-based company isn’t in urgent need for cash and may still decide not to proceed with a sale, the people said. 

Kurosawa declined to comment. LVMH did not respond to a request for comment. 

The 13-story building, wrapped in a glass exterior in the signature Tiffany blue, includes a private salon, VIP lounges and the brand’s first cafe in Japan. The luxury jeweller, which opened its new shop in 2025, occupies most of the building for its retail operations and offices.

Japan’s return to inflation, alongside corporate reforms that boosted deal flow, has driven a real estate investment boom in recent years. Commercial real estate investment in Japan rose 2 per cent in the first half of 2026, but return expectations for prime properties in Tokyo plunged to a record low, according to real estate agency CBRE. 

Fixed rent leases are common in Japan’s real estate market across apartments, offices and retail properties and rarely drew scrutiny given prices were stagnant for nearly three decades. But with inflation broadly above 2 per cent since 2022 in the country, potential investors are being deterred by the inability to raise rents in some buildings.

Founded in 1901, Kurosawa started as Japan’s first typewriter retailer and later acquired the land on which the Tiffany’s building stands today. The group’s business now spans real estate development and management, IT equipment sales and maintenance, as well as confectionery manufacturing and sales. BLOOMBERG