Sharing this article which appeared in ET Realty
MUMBAI/NEW DELHI: Delhi’s Connaught Place has emerged as world’s 6th most expensive office market while Mumbai’s Bandra Kurla Complex (BKC) office market ranked as the 18th most expensive office market across the globe, according to property advisory firm CBRE’s Global Prime Office Occupancy Costs survey.
While Delhi’s Connaught Place continued to figure in the top 10 global list of “most expensive” office markets, Mumbai’s secondary business district BKC dropped 3 places to 18th in the global rankings. Nariman Point too saw its rank slipping 2 spots to 32nd rank.
Annual occupancy cost in Connaught Place is $151.27 per sq ft as of September-end 2015, while Bandra-Kurla Complex is at about $94 per sq ft with Nariman Point at $72.71 per sq ft.
“The drop in ranking for Mumbai’s BKC is owing to a marginal decline reported in other cost components such as property tax and service charges, even as overall rents have mostly remained stable. On the other hand, rents and other real estate cost indicators were mostly stable for Nariman Point during the review period; however, a drop in ranking is due to a relative improvement in the ranking of other global markets,” said Anshuman Magazine, Chairman & MD, CBRE South Asia.
London’s West End was the world’s highest-priced office market for the second straight year. Hong Kong and Beijing took four of the top five slots in the rankings with Hong Kong’s Central, Beijing’s Finance Street, Beijing’s Central Business District (CBD), and Hong Kong’s West Kowloon, rounding out the top four.
Central London tops the list with occupancy cost at $272.56 per sq ft per year followed by central Hong Kong at $269.31 per sq ft per annum.
The survey provides data on office rents and occupancy costs as of September 30, 2015.
Prime occupancy costs which reflect rent, plus local taxes and service charges increased at a 2.4% annual pace globally, as the world economy continued to gradually improve and the service sector, a key bellwether for prime office space, entered its fourth year of expansion, driving healthy demand for space in top-quality properties.
Prime occupancy costs in Asia Pacific increased by 1.9% year-over-year from 1.4% in Q1 2015 compared to 3.1% growth in the Americas and 2.2% growth in Europe, the Middle East and Africa.