Average total occupancy, which includes rent, property taxes and a service charge, runs to $135 per sf in London, twice that of the next most costly European city, Paris. This year, the City of Light moved up from sixth place to fifth. Western Europe has some of the lowest office vacancy rates on the planet, averaging 3.75%, with some, such as Munich, below 1%.
In Central and Eastern Europe, rents declined an average of 5.6% even though the economies of those regions rebounded last year. Moscow was the most expensive location in that part of the world with rents going for $46 per sf.
In the US, the strongest markets are the 24-hour cities such as San Francisco where the prime vacancy rate has fallen to 2%, and Boston (2.2%) Downtown New York (3.2%) and Midtown NYC (4%)
"Office rents around the world have benefited from a relatively healthy global economy, with prime office rents rising by an average of 10% annually in the cities that we have analyzed," says Maria Sicola, senior managing director, research and analysis at Cushman & Wakefield. "Although the froth has come off the market, real estate fundamentals are still sound," she adds.
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