When it comes to global office space, the U.S. is starting to look incredibly cheap.
Most Americans take one look at the cost of living in New York and instantly realize that without a six-figure income you’re relegated to Queens or Hoboken. What about office space? Shouldn’t it be some of the most expensive in the world? This is New York!
Like the Geico lizard says, fuggetabout it!
New York doesn’t even register in the top 10 of the most expensive places on the planet for office space. According to commercial real estate firm CB Richard Ellis, New York’s Midtown ranks 18. Downtown, which is where Wall Street is headquartered, is No. 41. Even Rio de Janeiro and Sao Paulo, Brazil are more expensive than New York’s prime office space. Seoul office space is more expensive than downtown Manhattan.
Are we witnessing a commercial real estate bubble in emerging markets, people, or is this just more evidence that the Western world has lost its lure?
In a surprising sign of global economic recovery, office markets are transitioning from contraction to growth, but most of the recovery is happening outside of the U.S. and Europe.
Within the top 10 most expensive cities, six are in Asia. Of the 133 global office markets tracked for CBRE’s report, office occupancy costs increased in 80 markets during the first quarter of 2012 year over year. Only 24 markets reported declines during the same period. Office occupancy costs increased by an average 3.6 percent globally, led by Asia Pacific (7.8 percent) and the Americas thanks primarily to Brazil (5 percent). The Europe, Middle East and Africa region reported a muted 0.4 percent increase in occupancy costs, with eurozone concerns clearly affecting market fundamentals across the region.
Here’s the top 20 most expensive places on the planet to rent an office:
1. Hong Kong (Central)
2. London’s West End
4. Beijing (Jianguomen Business District)
6. Beijing (Finance Street)
7. Hong Kong (Kowloon)
8. Sao Paulo, Brazil
9. New Delhi, India (Connaught Place)
10. London Central (City)
11. Shanghai (Puxi district)
12. Rio de Janeiro
13. Mumbai (Bandra Kurla Complex)
14. Paris Ile-de-France, France
15. Sydney, Australia
17. Shanghai (Pudong)
18. New York (Midtown)
20. Mumbai (Nariman Point)
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