Hong Kong still most expensive market
According to CBRE Group, Inc.’s new Global Prime Office Rents survey, Hong Kong is the world’s highest-priced office market while European office markets showed the most consistent growth in prime office rent, mostly due to a lack of supply. Belfast (up 25 percent year-over-year) led the way among the 121 cities surveyed.
Hong Kong had two of the top three most expensive office markets. Hong Kong’s (Central) held the top spot with prime office rent of $264 per sq. ft. per year and Hong Kong (West Kowloon) ($163 per sq. ft.) was third. Rounding out the top five were two Chinese markets — Beijing (Finance Street) ($179 per sq. ft.) at #2 and Beijing (Central Business District (CBD)) ($156 per sq. ft.) at #4 — and London’s West End ($146 per sq. ft.). The most expensive market in North America was New York (Midtown Manhattan), number six on the global list, with a prime office rent of $144 per sq. ft.
Global prime office rents–which reflect rent, excluding local taxes and service charges for the highest-quality, “prime” office properties–rose 2.3 percent compared with a year-earlier for the 12 months ended [December 31, 2016], with EMEA up 3.7 percent and Asia Pacific and the Americas each up 1.8 percent.
Four of the top five fastest-growing (prime office rents) markets were in Europe, with Stockholm, Berlin and Dublin joining Belfast on the list. Chicago (Downtown), with rent growth of 19.9 percent was the top market in the Americas and was number two on the global list. Hong Kong (West Kowloon) with a rent rise of 9.3 percent was the top growth market in Asia.
“We expect the global economy to pick up momentum with growth boosted by fiscal expansion in the U.S.,” said Richard Barkham, global chief economist, CBRE. “Growth was underpinned by positive monetary conditions in Europe and increased government spending in China, both of which are expected to continue.”
CBRE tracks office rents for prime office space in 121 markets around the globe. Of the top 50 “most expensive” markets, 20 were in Asia Pacific, 19 were in EMEA and 11 were in the Americas.