Hong Kong (Central) is the world's highest-priced office market, London's West End comes second
Connaught Place in New Delhi has been ranked the ninth-most expensive prime office market in the world -- down from seventh last year - with an occupancy cost of $153.89 per square foot per annum, according to a survey.
According to the bi-annual Global Prime Office Occupancy Costs Survey of US-based CBRE, Mumbai’s Bandra Kurla Complex (BKC) moved one notch down from 19th to 20th while the CBD (Central Business District) of Nariman Point, also in Mumbai, ranked 33rd on the list of the top 50 most expensive office markets in the world.
Global prime office occupancy costs include rent, in addition to local taxes and service charges for the highest-quality, prime office properties.
Hong Kong (Central) became the world’s highest-priced office market with an occupancy cost of $302.51 per sq foot per annum. London’s West End comes second.
Asia continues to dominate the list of the world’s most expensive office locations, accounting for seven of the top 10, according to the survey.
Hong Kong (West Kowloon) at $190.02 per square foot and Beijing (CBD) at $183.10 per square foot featured among the top five most expensive markets. Apart from New Delhi (Connaught Place), Beijing (Finance Street), Tokyo (Marunouchi/Otemachi), and Shanghai (Pudong) also featured on the top 10 list.
Global prime office occupancy costs rose 1.9 per cent year on year, which is lower than the growth rate in the year ended January-March 2016 (2.2 per cent). This was largely attributed to the slowdown in year-on-year growth in the Asia-Pacific (1.2 per cent); and Europe, the Middle East (West Asia) and Africa (0.8 per cent). On the other hand, occupancy costs in the Americas increased by 3.6 per cent year-on-year.
The top 10 list remains largely consistent, reflecting the strength of these global gateway cities in attracting and maintaining a successful occupier base.
Anshuman Magazine, chairman (India & South-East Asia), CBRE, said: “Despite the fact that Connaught Place has a limited supply of prime office space, its location in the heart of India’s capital, coupled with great infrastructure and connectivity to other parts of the city, makes it an ideal location for any business to be in. With India’s commercial real estate segment continuing to do well, prime locations across the country including Connaught Place, Bandra Kurla Complex, and Nariman Point continue to witness demand for prime office space.”
While occupancy costs continue rise steadily, coupled with low vacancy levels and a limited supply, the commercial office segment is witnessing a strategic shift. Today’s occupier, in India and around the globe, is expecting their office space to have the latest technologies and amenities in the market, according to CBRE.
"While actual office spaces are shrinking, these amenities are growing to include virtual networks, videoconferencing, and cloud storage. Going forward, technology in the workplace will define how much a corporate’s employees need the office to reach their targets. This in turn will impact the demand for office space and subsequently the associated occupancy costs," it said.
CBRE tracks occupancy costs for prime office space in 121 markets around the globe. Of the top 50 most expensive markets, 18 are in the Asia-Pacific; 20 in Europe, the Middle East and Africa; and 12 in the Americas.By: Raghavendra Kamath
We will send you breaking news right
to your inbox
Read our latest news on any of these
Piramal Finance lends Rs 1,100 crore to real-estate developer Embassy Group
Piramal Finance (PFL), the lending arm of Piramal Enterprises, on Wednesday said that it has financed Rs 1,100 crore to Bengaluru-based Embassy Group. This funding has been done sequentially across both residential and commercial projects in Bengaluru, Chennai