London's West End is the world's most expensive office market for the second
year in a row, retaining its title ahead of runner-up Hong Kong, according to
research published Tuesday in Cushman & Wakefield's annual Office Space Across
the World report. Dublin moved up from 31st rank to 25th of 67 global locations.
Characterised by strong demand and a dwindling supply of high quality space, the
West End of London saw office rents increase by 5% in 2013. Furthermore, with
rents largely unchanged in Hong Kong's Central Business District (CBD) over the
year, the gap in total occupancy costs between the two cities has widened.
Global office rents increased by 3% overall.
"London remains attractive for many international businesses as its global
appeal continues to grow. With prime space at a premium in the West End and a
steady demand for offices from across all sectors, significant rental growth can
be anticipated in 2014," said Digby Flower, Cushman & Wakefield's UK chief
executive and head of London Markets.
Moscow's CBD surged from sixth position in last year's ranking to third, with
rents holding firm over the last 12 months as occupier demand remained
consistent. Meanwhile, rental growth was predominantly flat across Asia Pacific
with Beijing, Tokyo and New Delhi's Connaught Place mostly stable over the year.
However, Connaught Place fell from fourth position to eighth due to an
appreciation in both the U.S. dollar and euro against the Indian rupee in 2013;
this caused a shift in New Delhi's position in terms of global occupancy costs
when measured on a dollar or euro basis.
The annual rent per sqm in London's West End in 2014 is €2,122 compared with
Dublin's €485; €434 in Seoul, €432 in Helsinki; €345 in Copenhagen; €343 in Kuala Lumpur and €345 and €227 in Riga.
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