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Connaught Place among top 10 most expensive office markets in the world: Report

Mumbai (BKC) slips by ten places to 26th; Nariman Point declines to 37th position from 30th last year

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Connaught Place
Connaught Place

Delhi’s Connaught Place moved one notch up to be the ninth most expensive office location with an annual prime rent of USD 153.26 per sq ft from last year’s 10th most expensive office location. Mumbai’s Bandra Kurla Complex (BKC) on the other hand moved down to the 26th position with an annual prime rent of USD 96.51 per sq ft,says an annual Global Prime Office Occupancy Costs survey by  CBRE South Asia Pvt Ltd.

The central business district (CBD) of Nariman Point stands at the 37th position resulting in an annual prime rent of USD 72.80 per sq ft, it said.

Globally, Hong Kong (Central) at USD 306.57 per sq ft and London (West End) at USD 235.01 per sq ft continued to lead the ranking propelled by banking and finance sectors. Flexible space operators were also found to be highly active in the Hong Kong market.

The market with the steepest rise, Durban experienced strong demand from business-process outsourcing companies. Overall, the APAC region witnessed a 1.7 percent increase in occupancy cost this year from around 1.2 per cent in 2017.

“Strong demand from finance, technology and the e-commerce sectors has fueled the growth momentum in prime occupancy costs from last year & Commercial office market remains a strong growth propeller for the real estate sector.  Delhi, being a prime market, continues to witness significant activity and has moved one step ahead to the 9th position owing to stable vacancy, rents and absorption. We are optimistic about the Mumbai market and are expecting an upswing in the coming months,” says Anshuman Magazine, chairman – India and South-East Asia, CBRE.

Global prime office occupancy costs—which reflect rent, plus local taxes and service charges for the highest-quality, “prime” office properties—rose 2.4 percent year-over-year, with the Americas up 3.2 percent, EMEA up 2 percent and Asia Pacific up 1.7 percent, the survey said.

The survey highlights that for the first time in this cycle, prime office occupancy cost growth was consistent across all regions in the past 12 months. Global economic growth has stimulated robust leasing activity, particularly in EMEA and APAC regions and occupancy costs grew at a faster rate than last year. Also, Americas despite recording a mild slowdown period, witnessed the overall fastest increase in annual costs at 3.2 percent.

The Global Prime Office Occupancy Costs report is a survey of office rents for prime office space in 120 cities worldwide. The survey provides data on office rents as of first quarter of 2018. The Most Expensive ranking is based upon prime office rents in US$ per sq. ft. per annum. CBRE’s Global Prime Office Occupancy Costs survey is performed semi-annually in the first and third quarter of the year.

Top 10 Most Expensive Markets
(In US$ per sq. ft. per annum)
Rank Market Prime Rent
1 Hong Kong (Central), Hong Kong 306.57
2 London (West End), United Kingdom 235.01
3 Beijing (Finance Street), China 200.91
4 Hong Kong(Kowloon), Hong Kong 189.56
5 Beijing(CBD), China 189.44
6 New York (Midtown- Manhattan) 183.78
7 New York- (Midtown-South Manhattan) 171.56
8 Tokyo (Marunouchi/Otemachi), Japan 171.49
9 New Delhi (Connaught Place-CBD), India 153.26
10 London (City), United Kingdom 144.95
Source: CBRE Research, 2018
First Published on Jul 11, 2018 01:12 pm
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