Five most expensive office locations in the world

Added 25th January 2013

Hong Kong has lost its position as the world’s most expensive location to rent office space in favour of London’s West End, according to DTZ’s latest annual Global Occupancy Cost survey.

Five most expensive office locations in the world

The report, now in its 16th year, analysed the main components of occupancy costs per workstation across 126 business districts in 49 countries across the world.

London’s West End had to pay $23,500pa per workstation at the end of 2012, which is three times the world average.

Richard Howarth, head of DTZ West End, said: “ These figures are a tangible reflection of the fact that London is a highly attractive place to locate a business.”

He added: “While boutique specialist financial sector companies are happy to pay a premium to be based in one of the world’s premier business districts, recent transactions involving Google, Skype, Facebook and LinkedIn have all been at a considerable discount to Mayfair prices.”

In the US, occupancy costs fell by 10.9%, where demand for space was low and a trend across the board for greater space efficiency. However DTZ  predicted that costs will rise there, in contrast to offices in Kuala Lumpur and Singapore, where costs are expected to fall by 1.3% and 0.7% respectively.

Karine Woodford, head of occupier research at DTZ, said: “It should be noted that vacancy rates in Singapore are currently at their lowest level since2008, and we expect costs to rise steadily over the longer term.”

In North Asia, although costs rose by 6.3% on average, they fell by 12% in Hong Kong Central, from $25,160 in 2011 to $22,190 in 2012, due to rental declines, where occupiers sought to reduce operating costs through downsizing or moving outside the centre.

There was growth in Central and South America (0.6%), Europe (0.9%) and Middle East and Africa (1.4%) but this rate was below the global inflation level of 3.2%.

Five most expensive office locations:

         Cost pa  per work station ($):

  • 1. London West End 23,500
  • 2. Hong Kong  22,190
  • 3. Geneva  17,560
  • 4 Tokyo  17,280
  • 5. Zurich  16,420

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Mark Battersby

Editor, International Adviser

International Adviser

Mark Battersby is editor of International Adviser. He is also programme director for International Adviser events in strategic expat locations around the world, and its flagship FundLinks conference in London. Mark joined Last Word Media in February 2012, having previously worked at Citywire, Interactive Investor International, and FT Business.

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