In the third quarter grade-A office space in central Tokyo saw rents increase by 6.4 per cent, while vacancy rates fell to 5 per cent.

The rent increases come despite the world's third larget economy falling into recession this week. Gross domestic product (GDP) fell at an annualised 1.6 per cent from July to September, compared with forecasts of a 2.1 per cent rise. As a result Prime Minister Shinzo Abe has called a snap election.

The fact that Japan, which traditionally has been a difficult market for non-domestic wealth managers to penetrate, remains so expensive will weigh on the minds of firms seeking to enter this market.

“Grade-A office space in central Tokyo saw rents increase by 6.4 per cent in quarter three, as vacancy rates fell to 5 per cent. With the Marunouchi and Otemachi areas now virtually fully leased, the strong rental growth in Japan’s capital looks set to continue,” the report said.

Overall in the nineteen markets tracked in the region prime office rental growth was experienced in nine, with six rental declines and four markets recording no rental movement at all. China's Guangzhou, Shanghai and Beijing all recorded rental declines. Perth saw the largest rental decline at minus 1.3 per cent, probably as a direct knock on effect of a slowdown in China's economy, Knight Frank said. Brisbane also saw rents fall.

Meanwhile vacancy rates fell or remained steady in 15 of the 19 markets tracked, leading to a 0.2 per cent drop in the regional vacancy rate, which now stands at its lowest level since quarter four 2008.

Elsewhere Singapore continued to see solid rental growth of 1.2 per cent over the quarter - the fifth consecutive quarter of positive growth. With quarterly net absorption at a two-year high amid positive business sentiment and significant leasing enquiries, the market is similarly expected to see continued rental growth going forward, says Knight Frank.

In Jakarta, meanwhile, the market has slowed from the stellar growth rates of previous years with the significant pipeline of supply likely to moderate rental growth prospects going into 2015. In Kuala Lumpur, grade-A rental rates remain resilient while occupancy rates have improved marginally.

In mainland China, an economy which is attempting to manage its economic slowdown, a decline of activity from Multinational Corporations (MNCs) has contributed to rental declines across all tier-1 markets tracked. Hong Kong, despite its recent troubles, saw prime rents increase, with the opening of the Shanghai-Hong Kong Stock Connect likely to continue to boost mainland Chinese demand.

Taiwan's Taipei, introduced for the first time into the rental index, saw its prime rents remain fairly flat amid solid office net absorption led by the high-tech and finance sectors.