Rental growth was largely flat across Asia Pacific over the year, with an overall regional rental rise of just 2% in 201
OFFICE SPACE ACROSS THE WORLD 2014 A Cushman & Wakefield Research Publication
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
INTRODUCTION
CONTENTS
Welcome to the Cushman & Wakefield global Office Space Across the World publication for 2014. This report was prepared by the Cushman & Wakefield Research team to provide an analysis of the global office market during 2013, as well as discuss the industry’s main trends for the year ahead. The primary focus of this report is prime office rental performances and occupancy costs across the globe, including a ranking of the most expensive locations across the world in which to occupy office space. The report also provides a more in-depth rental and occupier overview for each region, concluding with a detailed list of market data pertaining to each office location.
Global Summary & Outlook 2
Most Expensive Locations
4
Americas Overview
6
Asia Pacific Overview
7
EMEA Overview
8
Market Metrics
10
Technical Specifications
14
Contacts
15
The information and data provided in this report are based on a comprehensive survey of Cushman & Wakefield’s international offices, and the editors are extremely grateful to them for their time, effort and assistance. The Cushman & Wakefield Research Group provides a strategic advisory and supporting role to our clients. Consultancy projects are undertaken on a local and international basis, providing in-depth advice and analysis, detailed market appraisals and location and investment strategies. For more information on what Research can do for you, please visit the Contacts page of this report (page 15). To gain access to all of Cushman & Wakefield’s research and publications globally, please visit the Research & Insight section of our global website: www.cushmanwakefield.com/research
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2014
A Cushman & Wakefield Research Publication
GLOBAL SUMMARY AND OUTLOOK
Global office rents moved up by 3% in 2013, which is the third consecutive year of a similar rental performance. While all three regions overall witnessed a relatively slow pace of rental growth over the year, certain areas – such as Africa and the Middle East – saw a more buoyant rental market, with prime rents up by as much as 10% in certain locations. RENTAL PERFORMANCE IN THE YEAR TO DEC 2013
46%
25%
28%
% of countries showing rental growth
% of countries showing stable rents
% of countries showing rental declines
Average Rental Change 3%
2
THE MOST EXPENSIVE GLOBAL MARKETS The most expensive office market globally was London (West End), which retained its position ahead of Hong Kong in second place. Prime rents in London continued to move up during 2013, bolstered by strong occupier demand and a declining supply of high-quality space. With rents largely unchanged in Hong Kong over the year, the gap in total occupancy costs between London and Hong Kong has, in fact, widened. New Delhi’s Connaught Place fell from fourth position to eighth despite prime rents being unchanged in 2013. This was primarily the result of an appreciation in both the US Dollar and Euro against the Indian Rupee in 2013, causing a shift in New Delhi’s position in terms of global occupancy costs. Similarly, exchange rate fluctuations with the Japanese Yen caused Tokyo to fall behind other comparable markets like Beijing in the overall ranking – despite prime rents in both cities remaining largely unchanged over the year.
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
ASIA PACIFIC: SLOW BUT STEADY
CITIES WITH THE LARGEST RENTAL GROWTH 900
50
Rent (EUR/sq.m/year)
40 35
600
30 450
25 20
300
15 10
150
% Rental Growth per Year
45 750
5 0
0 Sandton CBD
Durban CBD
Durban La Lucia/ Berea
Quito CBD
Jakarta CBD
RENT
Bangkok Singapore Dublin Cape Town New York CBD CBD Int’l Fin. CBD Downtown Svcs. Centre
RENTAL GROWTH
Rental growth was largely flat across Asia Pacific over the year, with an overall regional rental rise of just 2% in 2013. Economic conditions were more fragile in the first half of the year, although growth in core markets of China and Japan advanced as the year progressed. However, the region is well represented in terms of the most expensive office locations on a global scale. Hong Kong retained its position in second place overall, Beijing came in fourth position and Tokyo in fifth. Asia Pacific’s performance in 2014 is anticipated to be similar to that seen in 2013, with slow and stable demand anticipated to keep rental levels largely unchanged, albeit with incentives becoming more competitive. RENTAL PERFORMANCE IN THE 5 YEARS TO DEC 2013 15
The global occupier market in 2013 was again characterised by caution, as tenants across the globe remained concerned regarding occupancy costs. Indeed, while some tenants were looking to upgrade to more efficient, cost-effective office space, many still sought to consolidate their existing operations. Over the year, occupiers retained a focus on well located, high quality space, and demand for this type of accommodation was steadily rising by the end of 2013. As a result, the options open to occupiers tightened, and almost half of the locations analysed within the report witnessed prime rents increase over the year, albeit marginally in most cases.
10 % Rental Change per Year
OCCUPIER TRENDS
5 0 -5 -10 -15 -20 2009
2010 GLOBAL
2011 AMERICAS
2012 ASIA PACIFIC
2013 EMEA
AMERICAS: A MIXED BAG
EUROPE: FROM MARKET TO MARKET
Coming out of the double-digit expansion seen in 2012, prime rental growth in the Americas region was much more subdued, with an overall regional rise of just 1%. Rental performance in South America in 2013 was slow, with muted growth in the key markets of Argentina and Brazil. Ongoing economic uncertainty in both of these markets caused occupier demand to ease and prime rents to fall over the year. Although both Ecuador and Colombia saw burgeoning demand over the year, it was not enough to offset the rental declines in these larger markets. In the year ahead, South America is likely to face more uncertainty, with economic concerns affecting business confidence in a number of locations, although a steady rise in stability across the region will be seen as North America expands.
In Europe, a lack of high quality space characterised a number of markets, including London and Frankfurt, and with demand in these cities advancing over the year, prime rents were put under upward pressure. Therefore, although the overall regional picture was relatively muted over the year, there were notable differences from market to market. Looking ahead, the rental trend seen in 2013 will continue in to next year, with rents in the large majority expected to see modest growth, with locations such as London and Dublin experiencing more significant rental growth for good quality space.
In the USA, demand levels improved in 2013 as the economy recovered quicker than expected. Over the year, the USA saw strong leasing activity, with business confidence improving as the year progressed. However, rental performances were mixed across the country, with New York (Downtown) and Boston outperforming other markets. The outlook for 2014 is for the USA to continue to see rental levels expand and thus drive the overall regional growth in the year ahead.
“Prime rents in London continued to move up during 2013, bolstered by strong occupier demand and a declining supply of high-quality space.”
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2014
A Cushman & Wakefield Research Publication
MOST EXPENSIVE LOCATIONS BY COUNTRY (€/SQM/YEAR) 2014 2013 RANK RANK
LOCATION
OCCUPANCY COST PER SQ. M. PER YEAR
€0 1
London, UK West End
€2,122
2
Hong Kong, Hong Kong Central
€1,432
3
6
Moscow, Russia CBD
€1,092
4
7
Beijing, China CBD
€1,027
5
Tokyo, Japan CBD (5 Central Wards)
€1,003
8
New York, USA Midtown (Madison/5th Av.)
€993
3
Rio de Janeiro, Brazil Zona Sul
€991
4
New Delhi, India Connaught Place
€959
10
Paris, France CBD
€895
9
Sydney, Australia CBD
€844
14
Singapore, Singapore CBD
€803
12
13
Luxembourg, Luxembourg City CBD
€777
13
11
Oslo, Norway CBD
€756
21
Dubai, UAE DIFC
€734
12
Geneva, Switzerland CBD
€718
16
15
Almaty, Kazakhstan CBD
€661
17
n/a
Doha, Qatar CBD
€659
16
Stockholm, Sweden CBD
€593
17
Istanbul, Turkey CBD (Levent)
€572
20
18
Milan, Italy Centre
€556
21
19
Munich, Germany CBD
€540
25
Taipei, Taiwan CBD (Xinyi Planned Area)
€536
22
Amsterdam, Netherlands Zuidas
€506
24
24
Beirut, Lebanon CBD
€505
25
31
Dublin, Ireland CBD (2/4 Districts)
€485
26
Jakarta, Indonesia CBD
€469
27
Tel Aviv, Israel CBD
€457
29
Vancouver, Canada CBD
€442
29
23
Ho Chi Minh City, Vietnam CBD
€441
30
30
Madrid, Spain CBD
€439
34
Seoul, South Korea CBD
€434
32
Helsinki, Finland CBD
€432
n/a
Tbilisi, Georgia CBD
€427
28
Caracas, Venezuela CBD
€427
1 2
5 6 7 8 9 10 11
14 15
18 19
22 23
26 27 28
31 32 33 34
4
€500
€1,000
€1,500
RENT ADDITIONAL COSTS
€2,000
€2,500
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
MOST EXPENSIVE LOCATIONS BY COUNTRY 2014 2013 RANK RANK
LOCATION
OCCUPANCY COST PER SQ. M. PER YEAR
€0 20
Bogotá, Colombia Nogal
€426
36
Auckland, New Zealand CBD
€406
37
33
Warsaw, Poland CBD
€395
38
35
Brussels, Belgium Quartier Leopold
€393
37
Kyiv, Ukraine CBD
€373
39
Athens, Greece Syntagma Square
€358
44
Copenhagen, Denmark Harbour Area
€345
38
Kuala Lumpur, Malaysia CBD
€343
40
Budapest, Hungary CBD
€343
43
Vienna, Austria Central
€342
42
Bucharest, Romania CBD
€339
46
47
Buenos Aires, Argentina Catalinas
€331
47
41
Prague, Czech Republic CBD
€318
45
Mexico City, Mexico CBD
€306
48
Lisbon, Portugal Av. de Liberdade
€298
50
46
Santiago, Chile Las Condes
€289
51
52
Bangkok, Thailand CBD
€258
50
Bratislava, Slovakia CBD
€257
57
Belgrade, Serbia CBD
€242
54
54
Vilnius, Lithuania CBD
€238
55
49
Manila, Philippines Makati
€235
55
Lima, Peru CBD
€234
51
Manama, Bahrain Financial Harbour
€231
58
60
Riga, Latvia CBD
€227
59
53
Ljubljana, Slovenia CBD
€227
61
Sofia, Bulgaria CBD
€223
n/a
Skopje, FYRO Macedonia CBD
€222
58
Tallinn, Estonia CBD
€221
63
56
Zagreb, Croatia CBD
€207
64
62
Quito, Ecuador CBD
€179
59
Amman, Jordan CBD
€179
n/a
Limassol, Cyprus CBD
€179
63
Sandton, South Africa CBD
€150
35 36
39 40 41 42 43 44 45
48 49
52 53
56 57
60 61 62
65 66 67
€500
€1,000
€1,500
RENT ADDITIONAL COSTS
€2,000
€2,500
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2014
A Cushman & Wakefield Research Publication
AMERICAS
NORTH AMERICA HOLDING FIRM In 2013, many office markets in the USA witnessed robust demand as the economy started to improve at a rate stronger than previously expected, although performances were not uniform across the entire country – for example, New York and Boston both experienced double-digit rental growth over the year in certain key submarkets, far outperforming many of the other markets within the country. Boston’s advancement was underpinned by strong activity particularly from the financial and professional services sector, which pushed down vacancy and, subsequently, saw rents accelerate by 16% in 2013. In New York, steady interest from the technology, legal, advertising, media and health care sectors helped to sustain the CBD submarkets. New completions and demand from these active industries helped to push prime rents up by 17% in the Downtown submarket over the year.
MOST EXPENSIVE LOCATIONS: AMERICAS Total Occupancy Cost (USD/sq.ft/year)
150
30
62.5
25
50
20
37.5
15
25
10
12.5
% Rental Growth per Year
75
5
0
0 Quito New York Bogota CBD Downtown Nogai
Boston Mexico City San Back Bay CBD Francisco NOMA Financial District
RENT
Lima CBD
Seattle Financial District
Brasilia Los Angeles CBD West
RENTAL GROWTH
In Mexico the market was healthy over the year as both supply and demand remained largely consistent, and this steady demand for high-quality space helped to push support a 5% rise in rental rates in Mexico City. Canada as a whole was slightly more subdued than its other North American markets, with rents holding up in the majority of the key cities in 2013.
BRAZIL EASES BACK
120
The Brazilian economy, the principal driver within South America, was weaker than anticipated in 2013, which had a subsequent dampening on both business confidence and occupier demand. Furthermore, cities such as Bogotá and Buenos Aires saw supply outstrip demand over the year, resulting in prime rents easing in 2013.
90 60 30 0 New York Midtown
Rio de Janeiro Zona Sul
Sao Paulo Washington Boston San Francisco New York Faria Lima East End Back Bay NOMA Downtown Financial District
NORTH AMERICA
6
CITIES WITH LARGEST RENTAL GROWTH: AMERICAS
Rent (USD/sq.ft/year)
Although rental performance across the Americas barely changed in 2013, there was a notable polarisation in performances between North and South America. Regional rental growth was fuelled by increases in both the USA and Mexico, where prime rents moved up by 4% and 6%, respectively. Most South American locations, however, saw prime rents decline in 2013, with Colombia, and 2013’s frontrunner – Brazil, experiencing the largest year-over-year declines. Consequently, this divergence between the two regions gave way for New York City (Madison/5th Avenue) to retake the title of the most expensive market in the Americas region, pushing last year’s number one, Rio de Janeiro (Zona Sul), into second place.
Miami Brickell Avenue
SOUTH AMERICA
Brasilia CBD
Los Angeles West
In Rio de Janeiro (Zona Sul) prime rents fell by 7% over the year as occupiers continued to be cautious from the continued economic uncertainty, as well as the impending election in the latter half of 2014. However, the anticipation of the forthcoming World Cup and Olympic games over the next few years has brought a surge of infrastructure developments to the city, many of which are already underway, and it is hoped that these improvements will boost Rio’s attractiveness to international occupiers in the longer term.
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
THE YEAR AHEAD Looking ahead into 2014, with the foundation for stronger conditions in 2014 set in place, it is anticipated that the USA will continue to propel the region in terms of a buoyant economic growth. This should in turn have a positive effect on occupier demand and consequently help retain the upwards pressure on prime rents. In South America, the burgeoning markets of Colombia, Chile and Peru are anticipated to sustain any growth for the area. However, the outlook for Brazil – one of the key markets for the region is uncertain, with factors such as high inflation and an upcoming election becoming possible obstacles to future growth. As a result, business confidence and occupier demand are both expected to suffer from this and remain subdued, which could see further falls in prime rents over the course of the year.
ASIA PACIFIC
MOST EXPENSIVE LOCATIONS: ASIA PACIFIC 195 Total Occupancy Cost (USD/sq.ft/year)
“Half of the surveyed countries in the Americas region witnessed prime rents rise in 2013.”
162.5 130 97.5 65 32.5 0 Hong Kong Central
Beijing Central
Tokyo New Delhi CBD Connaught (5 Central Place Wards)
Shanghai Lujiazui (Pudong)
NORTH ASIA & INDIA
Sydney CBD
Singapore Mumbai Brisbane CBD Bandra Kurla Centre Complex
Shenzhen Futian
SOUTH ASIA & PACIFIC
HONG KONG KEEPS ITS REGIONAL CROWN Hong Kong was the second most expensive market globally and was also the most expensive location in Asia Pacific, followed by Beijing and Tokyo in second and third for the region, respectively. Occupier demand levels were muted in Hong Kong, with activity from larger occupiers in particular easing noticeably over the year. However, going forward, Hong Kong’s position as one of the most important global financial centres is anticipated to help buoy demand levels into 2014. Prime rents in Hong Kong are expected to remain largely stable with relatively few completions anticipated.
NORTH ASIA & INDIA: SLOWING RENTAL GROWTH In Beijing, prime rents eased marginally over the year, albeit figures starting at a very high base in early 2013. Indeed, the high rents within the CBD have caused many occupiers to rationalise their space as a way to cut down on costs. As China’s GDP growth remains steady, the continued development of the tertiary sector within Beijing has maintained momentum. However, at the current time there are concerns of future oversupply, leading many developers to review their development pipeline carefully. With occupier demand still relatively robust, prime rents are anticipated to be fairly flat in 2014.
Rental performance throughout Asia Pacific in 2013 largely followed the subdued pattern seen in 2012, with prime rents moving up by 2%. Despite easing in the first half of the year, the economic climate across the region improved as the year progressed, with China and Japan expanding. However, these positive performances were not enough to sustain regional growth, and consequently, many occupiers were notably cautious over the majority of the year.
Rental performance across India has been mixed, with the major markets remaining stable whilst others witnessed minor corrections. New Delhi’s CBD (Connaught Place) has remained the most expensive location across the country in 2013 due to its strong rental levels holding firm. With the domestic economy regaining some momentum towards the end of the year, occupier demand moved up significantly in the final quarter of the year, helping to push prime rents upwards in select cities that have low vacancies.
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2014
A Cushman & Wakefield Research Publication
The prime office market in Tokyo saw rental declines earlier in 2013; however, levels quickly bounced back to previous figures as the economy saw conditions gradually regain momentum. Business confidence increased over the year, and consequently many occupiers have become less cautious. With demand picking up, prime space in some building is becoming scarce, and therefore a rise in prime rents may occur over the next year.
BURGEONING MARKETS The Metro Manila office market was generally positive throughout 2013, primarily driven by the continued development of the Business Process Outsourcing (BPO) sector. Rents continued to climb due to strong absorption figures, especially in the CBD markets of Makati and Bonifacio Global City, while vacancy remained low despite the growth of office supply. Corporate occupiers continue to expand across major hubs, taking advantage of the talented pool and the lower wages of office workers in emerging cities.
WHAT’S IN STORE A slow performance has become the new norm for Asia Pacific; however, with regional GDP growth still hovering around 5.0-5.5%, Asia Pacific is still ahead of the other regions as seen in 2013. For 2014, a similar trajectory is anticipated, with slow but steady conditions akin to the previous year supporting occupier demand across the region. The key economies of China, Japan and markets in Southeast Asia are anticipated to drive the region forward, with office market demand in particular gaining momentum over the year.
EMEA
CITIES WITH LARGEST RENTAL GROWTH: ASIA PACIFIC 120
Rent (USD/sq.ft/year)
100
20
80
15
60 10
40
5
20 0
% Rental Growth per Year
25
0 Jakarta CBD
Bangkok Singapore CBD CBD
Manila Makati
Taipei Shenzhen CBD Futian (Xinyi Planned Area)
RENT
Seoul CBD
Shanghai Auckland Lujiazui CBD (Pudong)
Kolkata CBD
RENTAL GROWTH
The most notable rental growth over the year was seen in both Indonesia and Thailand, where prime rents rose by 20% in both Jakarta and Bangkok, respectively. In Indonesia, the improving domestic economy in 2013 translated into sturdy occupier demand and thus expanding take-up levels in Jakarta. In Thailand, limited supply and steady demand characterised the market in Bangkok and subsequently resulted in prime rents increasing over the year. However, the 2014 outlook for Thailand is more volatile due to the ongoing political uncertainty in the country. If political indecision is prolonged, some occupiers will take longer to conclude transactions or may start to look at alternative locations.
8
After five years of financial and economic uncertainty within Europe, the region finally began to see some stability return to the market as 2013 progressed, albeit with notable differences between markets. However, this improvement in economic conditions arrived too late to drive much growth in prime offices rents, with an overall regional uplift of just 3%. Nevertheless, this is the highest regional rise seen since 2008, before the depths of the economic downturn. LONDON LEADS THE WAY... Although the overall regional rental growth was minimal, EMEA still managed to possess the most expensive office market in the world for 2013, as London (West End) retained its title for the second consecutive year. The West End submarket is characterised by strong demand amid a dwindling supply of modern space. Indeed, with leasing activity building momentum over the year, these conditions bolstered a 5% rise in prime office rents in 2013. Rounding out the EMEA ranking, Moscow CBD followed London (West End) in second place, with Paris CBD in third.
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
CITIES WITH LARGEST RENTAL GROWTH: EMEA
600
40
500 30
400 300
20
200 10
100
...BUT GROWTH SURGES IN MIDDLE EAST & AFRICA The most significant rental expansion within the EMEA region was seen in the Middle East and Africa which witnessed rents increase by 14%. Both Qatar and Dubai saw business confidence pick-up through the year, resulting in increased office market activity as well as supporting prime rental growth of 10% and 5%, respectively. However, it was South Africa that experienced the highest rental growth in the EMEA region in 2013, with prime rents accelerating by almost 30%. The South African market saw a notable increase in the amount of large transactions over the year in the midst of a particularly active occupational market. MOST EXPENSIVE LOCATIONS: EMEA Total Occupancy Cost (EUR/sq.ft.year)
2,500
0
% Rental Growth per Year
50
700
Rent (EUR/sq.m/Year)
Key European cities such as London and Frankfurt saw prime rents appreciate in 2013, and this helped Western Europe outperform Central and Eastern Europe (CEE) for the first time since 2010. Rents in CEE moved up by just 0.2% in 2013 whereas Western Europe moved ahead by just over 2%. Furthermore, Dublin has rebounded strongly in 2013, and a combination of solid demand against a shortage of prime space has seen rents move up significantly, most notably in the IFS Centre submarket, where an annual rise of 19% was the highest in Europe.
0 Sandton CBD
Durban CBD
Durban Dublin Cape La Lucia Int’l Fin. Town /Berea Svcs. Centre CBD
COST
Riga CBD
Dublin Johannesburg Cape Luxembourg 2/4 Districts CBD Town CBD Bellville
RENTAL GROWTH
GOING FORWARD Looking ahead for the region, the overall lack of high quality space is expected to push many occupiers towards moving sooner rather than later, as they look to secure deals on the limited supply of quality space that is available. With the development pipeline anticipated to continue at low levels until the latter part of 2014, prime rents are likely to remain under pressure. Overall it will still be a mixed picture across Europe on a market-by-market basis in terms of rental performance, but growth across the region is expected to be slow but steady as confidence gradually returns.
2,000
ANNUAL SUB-REGIONAL RENTAL GROWTH
1,500 1,000 500 0 London West End
London City
Moscow CBD
Paris CBD
Luxembourg CBD
WESTERN EUROPE
Oslo CBD
Dubai DIFC
CEE
Geneva CBD
Almaty CBD
Doha CBD
1%
13%
MEA
OCCUPIER TREND: COST CONCERNS
Europe
Middle East & Africa
While demand is strengthening in a number of European markets, occupiers have remained cost conscious over the year, and consequently space rationalisation and consolidations have continued to drive a large component of regional market activity. However, there has been a divergence between prime and secondary space, with occupiers showing an increasing preference for good quality space rather than secondary. As a result, it has primarily been those locations that are experiencing a shortage of prime space that have seen rents rise over the year.
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2014
A Cushman & Wakefield Research Publication
COUNTRY SUMMARIES COUNTRY
CITY
MEASURING STANDARD
RENT QUOTED IN
RENT
NET INTERNAL AREA
ANNUAL RENTAL GROWTH (%)
RENT USD/ SQ.FT/YR
RENT EUR/ SQ.M/YR NIA
230.77
AMERICAS Argentina
Buenos Aires, Puetro Madero
NIA
USD/sq.m/mth
26.50
-5
29.54
Argentina
Buenos Aires, Catalinas
NIA
USD/sq.m/mth
30.00
0
33.45
261.25
Brazil
Sao Paulo, Faria Lima
NIA
BRL/sq.m/mth
161.68
-23
76.40
596.79
Brazil
Rio de Janeiro, Zona Sul
NIA
BRL/sq.m/mth
254.36
-7
120.19
938.89
Brazil
Brasilia, CBD
NIA
BRL/sq.m/mth
107.18
3
50.65
395.62
Canada
Toronto, CBD
GIA
CAD/sq.ft/year
25.97
1
27.86
217.66
Canada
Montreal, CBD
GIA
CAD/sq.ft/year
20.21
-4
21.68
169.38
Canada
Calgary, CBD
GIA
CAD/sq.ft/year
33.87
1
36.34
283.87
Canada
Vancouver, CBD
GIA
CAD/sq.ft/year
34.11
-1
36.30
285.88
Canada
Ottawa, CBD
GIA
CAD/sq.ft/year
25.57
-4
27.44
214.31
Colombia
Bogota, Nogal
NIA
USD/sq.m/mth
39.88
16
44.46
347.29
Colombia
Bogota, Andino
NIA
USD/sq.m/mth
39.36
-6
43.88
342.76
Chile
Santiago, Las Condes
NIA
USD/sq.m/mth
28.78
-1
32.08
250.62
Ecuador
Quito, CBD
NIA
USD/sq.m/mth
17.26
23
19.24
150.30
Mexico
Mexico City, CBD
NIA
USD/sq.m/mth
31.18
6
34.76
271.52
Peru
Lima, CBD
NIA
USD/sq.m/mth
22.60
5
25.20
196.81
United States
Atlanta, Midtown
GIA
USD/sq.ft/year
29.39
-4
32.33
252.53
United States
Boston, Back Bay
GIA
USD/sq.ft/year
59.51
16
71.41
557.82
United States
Chicago, West Loop
GIA
USD/sq.ft/year
39.26
-4
49.08
383.34
United States
Houston, CBD
GIA
USD/sq.ft/year
38.49
0
46.19
360.79
United States
Los Angeles, West
GIA
USD/sq.ft/year
49.68
2
57.13
446.27
United States
Miami, Brickell Avenue
GIA
USD/sq.ft/year
43.80
1
65.26
509.78
United States
New York, Downtown
GIA
USD/sq.ft/year
53.79
17
68.31
533.61
United States
New York, Midtown (Madison/5th Avenue)
GIA
USD/sq.ft/year
100.07
-1
127.09
992.72
United States
Philadelphia, West of Broad
GIA
USD/sq.ft/year
27.30
1
31.94
249.50
United States
San Francisco, NOMA Financial District
GIA
USD/sq.ft/year
58.50
5
70.20
548.35
United States
Seattle, Financial District
GIA
USD/sq.ft/year
35.22
4
40.50
316.38
United States
Washington, East End
GIA
USD/sq.ft/year
64.62
1
76.25
595.62
Venezuela
Caracas, CBD
GIA
USD/sqm/month
46.00
0
51.28
400.58
10
RENTAL TREND 2014
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
COUNTRY SUMMARIES COUNTRY
CITY
MEASURING STANDARD
RENT QUOTED IN
RENT
NET INTERNAL AREA
ANNUAL RENTAL GROWTH (%)
RENT USD/ SQ.FT/YR
RENT EUR/ SQ.M/YR NIA
844.05
RENTAL TREND 2014
ASIA PACIFIC Australia
Sydney , CBD
NIA
AUD/sq.m/year
1,300.00
3
108.05
Australia
Melbourne, CBD
NIA
AUD/sq.m/year
800.00
0
66.49
519.41
Australia
Brisbane, Centre
NIA
AUD/sq.m/year
870.00
1
72.31
564.86
China
Beijing, CBD
NIA
CNY/sq.m/mth
665.00
-3
122.46
956.61
China
Shanghai, Lujiazui (Pudong)
NIA
CNY/sq.m/mth
579.63
5
106.74
833.80
China
Guangzhou, Pearl River New City
NIA
CNY/sq.m/mth
245.23
-10
45.16
352.76
China
Chengdu, CBD
NIA
CNY/sq.m/mth
161.10
-11
29.67
231.74
China
Shenzhen, Futian
NIA
CNY/sq.m/mth
329.00
9
60.59
473.27
Hong Kong
Hong Kong, Central
NIA
HKD/sq.ft/mth
103.39
-1
160.01
1,249.92
India
Mumbai, Bandra Kurla Complex
GEA
INR/sq.ft/mth
285.12
0
82.42
643.81
India
Mumbai, CBD
GEA
INR/sq.ft/mth
275.10
0
62.44
487.78
India
New Delhi, Connaught Place
GEA
INR/sq.ft/mth
414.39
0
114.96
898.03
India
Bengaluru, CBD
GEA
INR/sq.ft/mth
85.47
-3
23.69
185.04
India
Chennai, CBD
GEA
INR/sq.ft/mth
75.50
0
19.53
152.56
India
Hyderabad, Suburban (Madhapur, Gachibowli)
GEA
INR/sq.ft/mth
41.19
2
9.99
78.03
India
Pune, CBD
GEA
INR/sq.ft/mth
80.01
-4
20.70
161.67
India
Kolkata, CBD
GEA
INR/sq.ft/mth
133.27
4
38.52
300.93
Indonesia
Jakarta, CBD
GIA
USD/sq.m/mth
47.26
20
60.06
469.17
Japan
Tokyo, CBD (5 Central Wards)
NIA
JPY/tsubo/mth
40,000.00
0
128.34
1,002.56
South Korea
Seoul, CBD
GIA
KRW/sq.m/mth
32,299.00
6
40.26
314.50
South Korea
Seoul, Gangnam
GIA
KRW/sq.m/mth
26,933.00
-1
33.57
262.25
South Korea
Seoul, Yeouido
GIA
KRW/sq.m/mth
21,149.00
-5
26.36
205.93
Malaysia
Kuala Lumpur, CBD
NIA
MYR/sq.ft/mth
12.00
0
43.96
343.41
New Zealand
Auckland, CBD
NIA
NZD/sq.m/mth
45.00
5
41.29
322.54
Philippines
Manila, Makati
NIA
PHP/sq.m/mth
1,006.00
12
25.27
197.39
Philippines
Manila, Ortigas
NIA
PHP/sq.m/mth
650.00
0
16.33
127.54
Singapore
Singapore, CBD
NIA
SGP/sq.ft/mth
10.82
19
102.84
803.30
Taiwan
Taipei, CBD (Xinyi Planned Area)
GEA
TWD/ping/mth
5,698.00
10
64.47
503.65
Thailand
Bangkok, CBD
GIA
THB/sq.m/mth
900.00
20
32.98
257.60
Vietnam
Ho Chi Minh City, CBD
NIA
USD/sq.m/mth
45.70
-7
50.95
397.97
Vietnam
Hanoi, CBD
NIA
USD/sq.m/mth
37.60
-6
41.92
327.43
11
2014
A Cushman & Wakefield Research Publication
COUNTRY SUMMARIES COUNTRY
CITY
MEASURING STANDARD
RENT QUOTED IN
RENT
NET INTERNAL AREA
ANNUAL RENTAL GROWTH (%)
RENT USD/ SQ.FT/YR
RENT EUR/ SQ.M/YR NIA
EMEA Austria
Vienna, Central
NIA
EUR/sq.m/mth
25.00
2
38.41
300.00
Austria
Innsbruck, CBD
NIA
EUR/sq.m/mth
11.00
0
16.90
132.00
Belgium
Brussels, Quartier Leopold
GEA
EUR/sq.m/year
275.00
-4
40.49
316.25
Belgium
Antwerp, Centre
GEA
EUR/sq.m/year
145.00
0
21.35
166.75
Bulgaria
Sofia, CBD
GEA
EUR/sq.m/mth
12.50
0
22.08
172.50
Croatia
Zagreb, CBD
NIA
EUR/sq.m/mth
14.50
-6
22.28
174.00
Cyprus
Nicosia, CBD
GEA
EUR/sq.m/mth
14.00
-7
18.28
142.80
Cyprus
Limassol, CBD
GEA
EUR/sq.m/mth
14.00
-13
18.28
142.80
Czech Republic
Prague, CBD
GIA
EUR/sq.m/mth
20.25
-4
33.60
262.44
Czech Republic
Brno, CBD
GIA
EUR/sq.m/mth
12.00
4
19.91
155.52
Denmark
Copenhagen, Harbour Area
GEA
DKK/sq.m/year
1,800.00
0
34.59
270.23
Denmark
Aarhus, CBD
GEA
DKK/sq.m/year
1,200.00
0
23.06
180.15
Estonia
Tallinn, CBD
GIA
EUR/sq.m/mth
13.00
8
22.97
179.40
Finland
Helsinki, CBD
NIA
EUR/sq.m/mth
32.00
0
49.16
384.00
France
Paris, CBD
NIA
EUR/sq.m/year
800.00
-2
102.41
800.00
France
Paris, La Defense
NIA
EUR/sq.m/year
530.00
-4
67.85
530.00
France
Lyon, CBD
NIA
EUR/sq.m/year
260.00
0
33.28
260.00 240.00
France
Marseille, CBD
NIA
EUR/sq.m/year
240.00
0
30.72
FYRO Macedonia
Skopje, CBD
GIA
EUR/sq.m/mth
13.50
0
23.23
181.44
Georgia
Tbilisi, CBD
NIA
USD/sq.m/mth
40.00
0
44.59
348.33
Germany
Berlin, CBD
NIA
EUR/sq.m/mth
22.00
0
33.80
264.00
Germany
Frankfurt, CBD
NIA
EUR/sq.m/mth
37.00
9
56.84
444.00 288.00
Germany
Hamburg, CBD
NIA
EUR/sq.m/mth
24.00
0
36.87
Germany
Munich, CBD
GIA
EUR/sq.m/mth
32.00
2
57.83
451.76
Germany
Dusseldorf, CBD
NIA
EUR/sq.m/mth
27.50
10
42.25
330.00
Greece
Athens, Syntagma Square
GEA
EUR/sq.m/mth
22.00
0
39.88
311.52
Hungary
Budapest, CBD
GIA
EUR/sq.m/mth
21.00
0
35.49
277.20
Ireland
Dublin, 2/4 Districts
NIA
EUR/sq.m/year
355.00
16
45.45
355.00
Ireland
Dublin, Int’l Fin. Svcs. Centre
NIA
EUR/sq.m/year
231.00
19
29.57
231.00
Ireland
Cork, Lapps Quay
NIA
EUR/sq.m/year
200.00
5
25.60
200.00
Italy
Rome, Centre
GEA
EUR/sq.m/year
425.00
-6
58.76
459.00
Italy
Milan, Centre
GEA
EUR/sq.m/year
475.00
-5
65.67
513.00
Kazakhstan
Almaty, CBD
GIA
USD/sq.m/mth
60.00
9
76.92
600.87
Latvia
Riga, CBD
GIA
EUR/sq.m/mth
14.00
17
22.58
176.40
Lithuania
Vilnius, CBD
GIA
EUR/sq.m/mth
14.50
4
24.50
191.40
Luxembourg
Luxembourg City, CBD
GEA
EUR/sq.m/mth
45.00
13
85.72
669.60
Netherlands
Amsterdam, Zuidas
GIA
EUR/sq.m/year
365.00
1
54.97
429.41
Netherlands
Rotterdam, CBD
GIA
EUR/sq.m/year
180.00
0
27.11
211.76
Norway
Oslo, CBD
GEA
NOK/sq.m/year
4,500.00
6
85.45
667.47
Norway
Bergen, CBD
GEA
NOK/sq.m/year
2,250.00
2
42.72
333.74
Poland
Warsaw, CBD
GIA
EUR/sq.m/mth
25.00
-6
41.48
324.00
Poland
Krakow, CBD
GIA
EUR/sq.m/mth
15.00
0
24.89
194.40
12
RENTAL TREND 2014
OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
COUNTRY SUMMARIES COUNTRY
CITY
MEASURING STANDARD
RENT QUOTED IN
RENT
NET INTERNAL AREA
ANNUAL RENTAL GROWTH (%)
RENT USD/ SQ.FT/YR
RENT EUR/ SQ.M/YR NIA
RENTAL TREND 2014
EMEA Poland
Wroclaw, CBD
GIA
EUR/sq.m/mth
15.50
0
25.72
200.88
Portugal
Lisbon, Av de Liberdade
GIA
EUR/sq.m/mth
18.50
0
31.26
244.20
Portugal
Porto, CBD
GIA
EUR/sq.m/mth
13.50
0
22.81
178.20
Romania
Bucharest, CBD
GIA
EUR/sq.m/mth
19.00
0
34.34
268.24
Romania
Timisoara, CBD
GIA
EUR/sq.m/mth
12.00
4
21.69
169.41
Russia
Moscow, CBD
GIA
USD/sq.m/year
1,200.00
0
127.09
992.74
Russia
St.Petersburg, CBD
GIA
USD/sq.m/year
440.00
-8
46.60
364.01
Serbia
Belgrade, CBD
GIA
EUR/sq.m/mth
15.00
0
25.81
201.60
Slovakia
Bratislava, CBD
GIA
EUR/sq.m/mth
15.00
-3
24.89
194.40
Slovenia
Ljubljana, CBD
GIA
EUR/sq.m/mth
11.00
-15
19.94
155.76
Spain
Madrid, CBD
GEA
EUR/sq.m/year
294.00
0
45.16
352.80
Spain
Barcelona, CBD
GEA
EUR/sq.m/year
213.00
-1
32.72
255.60
Sweden
Stockholm, CBD
NIA
SEK/sq.m/year
4,650.00
1
67.26
525.42
Sweden
Gothenburg, CBD
NIA
SEK/sq.m/year
2,450.00
0
35.44
276.84
Switzerland
Zurich, CBD
NIA
CHF/sq.m/year
760.00
0
79.39
620.16
Switzerland
Geneva, CBD
NIA
CHF/sq.m/year
800.00
0
83.56
652.79
Turkey
Istanbul, European side (Levent)
GEA
USD/sq.m/year
528.00
0
60.83
475.12
Turkey
Ankara, CBD
GEA
USD/sq.m/year
276.00
0
31.80
248.36
Ukraine
Kyiv, CBD
GIA
USD/sq.m/year
430.00
0
47.14
368.21
United Kingdom
London, West End
NIA
GBP/sq.ft/year
110.00
5
182.18
1,423.11
United Kingdom
London, City
NIA
GBP/sq.ft/year
57.50
5
95.23
743.90
United Kingdom
Manchester, CBD
NIA
GBP/sq.ft/year
30.00
5
49.69
388.12
United Kingdom
Birmingham, CBD
NIA
GBP/sq.ft/year
27.50
0
45.54
355.78
United Kingdom
Belfast, CBD
NIA
GBP/sq.ft/year
13.00
4
21.53
168.19
United Kingdom
Edinburgh, CBD
NIA
GBP/sq.ft/year
29.00
7
48.03
375.18
United Kingdom
Glasgow, CBD
NIA
GBP/sq.ft/year
28.00
4
46.37
362.25
United Kingdom
St.Peter Port, CBD
NIA
GBP/sq.ft/year
45.00
6
74.53
582.18
Bahrain
Manama, Financial Harbour
NIA
BHD/sq.m/mth
8.00
0
23.66
184.79
Israel
Tel Aviv, CBD
GEA
NIS/sq.m/mth
97.00
1
41.44
323.68
Israel
Tel Aviv (Ramat Hahayal)
GEA
NIS/sq.m/mth
73.00
6
31.18
243.59
Jordan
Amman, CBD
GEA
USD/sq.m/year
170.00
-11
19.58
152.98
Lebanon
Beirut, CBD
GEA
USD/sq.m/year
450.00
0
51.64
403.40
Qatar
Doha, CBD
NIA
QAR/sq.m/mth
230.00
10
70.41
550.04
South Africa
Durban, CBD
NIA
ZAR/sq.m/mth
70.00
40
7.45
58.20 112.25
South Africa
Durban, La Lucia/Berea
NIA
ZAR/sq.m/mth
135.00
35
14.37
South Africa
Cape Town, CBD
NIA
ZAR/sq.m/mth
100.00
18
10.64
83.15
South Africa
Cape Town, Bellville
NIA
ZAR/sq.m/mth
85.00
13
9.05
70.67
South Africa
Johannesburg, CBD
NIA
ZAR/sq.m/mth
75.00
15
7.98
62.36
South Africa
Sandton, CBD
NIA
ZAR/sq.m/mth
180.00
44
19.16
149.66
United Arab Emirates
Abu Dhabi, CBD
NIA
AED/sq.m/year
2,000.00
0
50.59
395.16
United Arab Emirates
Dubai, DIFC
NIA
AED/sq.ft/year
285.00
10
77.59
606.12
13
2014
A Cushman & Wakefield Research Publication
TECHNICAL SPECIFICATION EXCHANGE RATES COUNTRY
LOCAL CURRENCY
US DOLLAR
EURO
COUNTRY
LOCAL CURRENCY
Australia
Dollar (AUD)
0.8946
0.6493
New Zealand
Dollar (NZD)
US DOLLAR
EURO
0.8230
0.5973
Bahrain
Dinar (BHD)
2.6525
1.9249
Norway
Kroner (NOK)
0.1648
0.1196
Brazil
Real (BRL)
0.4239
0.3076
Philippines
Peso (PHP)
0.0225
0.0164
Canada
Dollar (CAD)
0.9412
0.6830
Singapore
Dollar (SGD)
0.7920
0.5748
China
Renminbi (CNY)
0.1652
0.1199
South Korea
Won (KRW)
0.0009
0.0007
Denmark
Krone (DKK)
0.1847
0.1340
South Africa
Rand (ZAR)
0.0955
0.0693
Eurozone
Euro (EUR)
1.3780
1.0000
Sweden
Krona (SEK)
0.1557
0.1130
Hong Kong
Dollar (HKD)
0.1290
0.0936
Switzerland
Franc (CHF)
1.1244
0.8160
India
Rupee (INR)
0.0162
0.0117
Taiwan
Dollar (TWD)
0.0336
0.0244
Indonesia
Rupiah (IDR)
0.0000822
0.0000595
Thailand
Baht (THB)
0.0304
0.0221
Israel
Shekel (ILS)
0.2881
0.2091
United Arab Emirates
Dirham (AED)
0.2723
0.1976
Japan
Yen (JPY)
0.0095
0.0069
United Kingdom
Pound (GBP)
1.6562
1.2019
Malaysia
Ringgit (MYR)
0.3053
0.2216
United States
Dollar (USD)
1.0000
0.7257
Source: Financial Times, 31st December 2013. All currencies to four decimal places unless stated.
DEFINITIONS
REPORT INFORMATION
For each location a standard definition of a prime unit is employed to endeavor to make the results as comparable as possible given varying local practices. Rents are often quoted on different measurements bases, and for this reason we have standardized the office rents used in this guide by adjusting the rent to a net internal area basis. Some countries quote their rents inclusive, and some exclusive, of service charges and property taxes. With this in mind, in order to make a more detailed comparison across the regions the total occupancy costs were used. CBD office figures relate to new prime centre, high specification units of a standard size commensurate with demand in each location.
This report was written by Barrie David and Erin Can of the European Research Group, London. Further information and copies of this report are available from Erin Can of the European Research Group, London.
The Net Internal Areas figures have been calculated by standardizing the floorspace measurements on which the quoted rent is based. There are various efficiency rates that are relevant to different countries, and we have used a standard for each country (unless stated). Cushman & Wakefield Asia quote all rents on a net usable area and quote effective rents, which takes into account rent-free periods or capital contributions where appropriate, although security deposits are not included. These rents have not been adjusted. Direct Class A rents are quoted in all US locations. Rents have been expressed in USD per square foot per year and EUR per square meter per year, converted using exchange rates as at December of the relevant year. Rental growth figures are quoted in local currency unless otherwise indicated. Total occupancy costs take into account service charges and local taxes to allow direct comparison between countries. 14
Telephone: +44 207 152 5206 Email:
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OFFICE SPACE ACROSS THE WORLD
A Cushman & Wakefield Research Publication
CONTACTS GLOBAL OFFICE CONTACTS
THE AMERICAS
ASIA PACIFIC
EMEA
James M. Underhill CEO The Americas Tel: +1 202 471 3600 Email:
[email protected]
Richard Middleton Executive Managing Director Corporate Occupier & Investor Services Asia Pacific Tel: +85 2 2956 7075 Email:
[email protected]
James Young Head of EMEA Offices Tel: +44 207 152 5113 Email:
[email protected]
THE AMERICAS
ASIA PACIFIC
EMEA
Maria T. Sicola Executive Managing Director Americas Research Tel: +1 415 773 3542 Email:
[email protected]
Sigrid Zialcita Managing Director Asia Pacific Research Tel: +65 6232 0875 Email:
[email protected]
Barrie David Senior Research Consultant EMEA Research Tel: +44 207 152 5937 Email:
[email protected]
GLOBAL RESEARCH CONTACTS
ALLIANCE & ASSISTANCE This report has been prepared by Cushman & Wakefield and its alliance partners globally. The information was collected and analysed by the European Research Group from the Cushman & Wakefield network, with particular thanks to the following offices: AUSTRIA
Inter-pool Immobilien GmbH
BAHRAIN
Cluttons LLP
BULGARIA
Forton
CHANNEL ISLANDS DENMARK
Buckley & Company Ltd. RED – Property Advisers
ESTONIA
Ober-Haus Real Estate Advisers
FINLAND
Tuloskiinteistot Oy
FYRO MACEDONIA GEORGIA
Forton Veritas Brown
GREECE IRELAND ISRAEL JORDAN KAZAKHSTAN LATVIA LEBANON LITHUANIA MALAYSIA
Proprius SA Lisney LLP Inter Israel Real Estate Consultants
NEW ZEALAND NORWAY
Bayleys Realty Group Ltd. Eiendomshuset Malling & Co.
QATAR
Cluttons LLP
Michael Dunn & Co S.A.L
ROMANIA
Activ Property Services
Veritas Brown
SLOVENIA
S-Invest d.o.o.
Ober-Haus Real Estate Advisers
SOUTH AFRICA
Michael Dunn & Co S.A.L
SWITZERLAND
Ober-Haus Real Estate Advisers YY Property Solutions
THAILAND
ProAfrica Property Services SPG Intercity Nexus Property Consultants Ltd.
UNITED ARAB EMIRATES
Cluttons LLP
15
Cushman & Wakefield (C&W) is known the world-over as an industry knowledge leader. Through the delivery of timely, accurate, high-quality research reports on the leading trends, markets around the world and business issues of the day, we aim to assist our clients in making property decisions that meet their objectives and enhance their competitive position. In addition to producing regular reports such as global rankings and local quarterly updates available on a regular basis, C&W also provides customized studies to meet specific information needs of owners, occupiers and investors. Cushman & Wakefield is the world’s largest privately-held commercial real estate services firm. The company advises and represents clients on all aspects of property occupancy and investment, and has established a position in the world’s major markets, as evidenced by its frequent involvement in many of the most significant property leases, sales and management assignments. Founded in 1917, it has approximately 250 offices in 60 countries, employing more than 16,000 professionals. It offers a complete range of services for all property types, including leasing, sales and acquisitions, equity, debt and structured finance, corporate finance and investment banking, corporate services, property management, facilities management, project management, consulting and appraisal. The firm has nearly $4 billion in assets under management globally. A recognized leader in local and global real estate research, the firm publishes its market information and studies online at www.cushmanwakefield.com/knowledge This report has been prepared solely for information purposes. It does not purport to be a complete description of the markets or developments contained in this material. The information on which this report is based has been obtained from sources we believe to be reliable, but we have not independently verified such information and we do not guarantee that the information is accurate or complete.
16
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