New digital agency's move to set up in high-end Tokyo complex sparks controversy

TOKYO -- Minister for Digital Transformation Takuya Hirai announced at a press conference held after a June 18 Cabinet meeting that the office of the digital agency, which will be established on Sept. 1, will be set up in a high-end complex in the capital's Chiyoda Ward.

The facility, Tokyo Garden Terrace Kioicho, is a 36-story skyscraper constructed in 2016 on the site of the former Grand Prince Hotel Akasaka, and also houses IT giant Yahoo Japan Corp. Monthly rent is expected to reach tens of millions of yen, and it seems controversial whether a large office in the city center is needed when teleworking is becoming widespread.

Staff members at the Cabinet Secretariat's Information Technology (IT) Comprehensive Strategy Office and Social Security and Tax Number System promotion office will apparently start working there from June 21, as they prepare to launch the agency. The complex consists of hotels, commercial facilities and office floors, and the digital agency will be set up on the 19th and 20th floors.

The IT office earlier moved from a 30-year-old-plus building in the Kasumigaseki area to the newly completed Tokyo Toranomon Global Square in the capital's Minato Ward in August 2020. The number of employees, which was around 150 at the time, is scheduled to increase to about 500 when the digital agency kicks off this September. The expansion of the organization has progressed at a rapid pace, leading to the decision to move again.

According to major real estate agency Sanko Estate Co., Tokyo Garden Terrace Kioicho, is an "A-class," or the highest level, facility in terms of total floor area, age of the building, equipment and other elements. The market rental rate of A-class buildings in central Tokyo, excluding common service fees, is declining due to the spread of the coronavirus, but as of March 2021, the monthly rent per tsubo (3.3 square meters) is about 35,000 yen (roughly $318).

If the digital agency rents two office floors (a total of about 2,000 tsubo) at the Tokyo Garden Terrace Kioicho, the monthly rent is estimated to be about 70 million yen (approx. $635,238) by simple calculation. A senior Cabinet Secretariat official said, "I can't say anything," about the rent, but "I think it's basically around market price."

(Japanese original by Tsuyoshi Goto, Business News Department)