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European Office Rents Fall as Global Downturn Hits

LONDON-Office rents in the major European cities were not immune from the global economic downturn during 2001. According to the latest world office rents survey from Insignia, sharp declines in rents in many North American office markets in the first half of 2001 spread to parts of Europe and Asia in the second half of the year.

By Graham Parker | Updated on February 27, 2002

LONDON-The global economic downturn shook office market across Europe during 201, according to Insignia. Office rents began falling in North America during the first half of 2001, according to the agent, and by the second half of the year the contagion had spread to Europe and Asia.

But so far European centres have escaped the dramatic slumps seen on the West Coast of the USA, where Silicon Valley rents fell 40% and San Francisco saw a 52% collapse in prime rental values. The hardest-hit locations in Europe are Berlin and Munich in Germany, where rents fell 12% and10% respectively. London’s West End retained its position as the most expensive office market in the world, despite a fall of almost 10%. By the end of 2001 the total cost of occupying prime West End office space had fallen to $146 per sf per annum.

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