Of the markets surveyed, only 20 saw a decrease in occupancy costs while 150 saw increases. Abu Dhabi saw the largest increase in occupancy cost jumping 92.8% to $52.82 per sf. Ward Caswell, US director of research for CBRE, says these findings are a great sign. Six months ago, "For the first time we were seeing all the top global markets in an upswing at the same time," he says. "We are seeing that continue and in a lot of the places accelerate."
England and Japan hold the top four positions. The most expensive market was London's West End, posting $212.03 per sf. This is 45% higher than the second ranked Tokyo at $145.68 then London proper at $144.78 and the outer central area of Tokyo in fourth place with $133.54.
Midtown Manhattan, a staple on the top 50 office rent markets, was ranked 24, with an average price per sf of $62.07. For the first time, Downtown Manhattan made the top 50 ranking. The now reviving portion of the island ranked 48 with the average price per sf at $41.99.
Beyond Manhattan, Washington, DC is the only other US market to make the top 50 list. The average rent there is $43.58, giving the country's capital the 44 position.
Not having more US cities on the top 50 list, Caswell says is a good sign. "The rental rates in the US are a bargain globally. If you compare the rental rates to the intellectual capital it is an overwhelming opportunity for the US to advance in leadership positions." Caswell says that if a company is looking to locate its global headquarters in London or New York, it is apparent New York is the better bargain.
It's not about winning the ranking, according to Caswell. "We should be comforted in knowing we have done a good job in making sure there is growth in rents and in the size of the markets."
Certain markets jumped significantly in the ranks. Mumbai, India is now ranked seventh in the most expensive markets. The city climbed from $41 to $106 average price per sf in the last year.
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