Tokyo emerges as most expensive office market place
Tokyo is now the most expensive office property market in the world, overtaking London in the latest index from property consultants CB Richard Ellis.
Prime offices in the Japanese capital's Inner Central District now cost $183.62 per square foot with the West End of London coming in at $172.62 per square foot, according to the Global Office Occupancy Costs report. The exchange rate of the sterling to the dollar further pulled down the cost, in dollar terms, of occupying office space in London.
Moscow is the third most expensive global office location at $170.62 per square foot.
And overall the world's office markets have been hit hard by the economic downturn. Just a year ago office space in London's West End was nearly $300 a square foot.
The worst decline in occupancy costs was in Singapore which saw occupational costs drop by 34.4%. Hong Kong, Mumbai and New York also experienced large drops. Overall in the US nine cities posted double digit falls.
Marseilles in the south of France saw the steepest increase in occupational costs at 30.4% and Perth, Australia also experienced an increase but the report points out this is very much the exception and due to remarkable local conditions.
'The great global recession has clearly taken its toll on the world's office markets particularly those with significant concentrations of financial industry employers.
The most expensive office markets, as measured in dollars, are considerably less expensive than a year ago and occupiers are now in a strong position to procure prime space at attractive costs,' said Dr Raymond Torto, CBRE's global chief economist.
Across the 170 cities measured in the report office occupancy costs fell 2.8% over the year ending in March 2009 compared with an increase of 8% in the year ending in September 2008.
Latin America held up stronger than the rest of the world, with only three cities posting small negative growth rates, the worst of which was Mexico City, with a 5.6% increase.