London remains world’s most expensive office market
4th February 2015
London’s West End remained the world’s highest-priced office market but Asia continued to dominate the world’s most expensive office locations, accounting for three of the top five markets, according to CBRE Research’s semi-annual Global Prime Office Occupancy Costs survey. The study also found that prime rents are rising fastest in the Americas.
London West End’s overall prime occupancy costs of USD 274 per sq. ft. per year topped the “most expensive” list.
Hong Kong (Central) followed with total prime occupancy costs of USD 251 per sq. ft., Beijing (Finance Street) (USD 198 per sq. ft.), Beijing (Central Business District [CBD]) (USD 189 per sq. ft.) and Moscow (USD 165 per sq. ft.) rounded out the top five.
The change in prime office occupancy costs mirrored the gradual, multi-speed recovery of the global economy. Global prime office occupancy costs rose 2.5% year-over-year, led by the Americas and Asia Pacific. Meanwhile, EMEA was essentially flat, edging up 0.3 percent year-over-year.
“We expect the gradual recovery of the global economy to continue, leading to better hiring rates and further reduction in the availability of space across most markets over the near term,” said Richard Barkham, Global Chief Economist, CBRE. “In this environment, we expect occupancy costs to continue rising from current levels, further limiting options for occupiers. Technology, quality and flexibility are expected to increasingly come into consideration in space use and location decisions, as occupiers will seek to contain costs and improve productivity.”