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US a bargain, according to CBRE's latest survey.

Occupation costs for prime office space continue to rise in most global markets, particularly in Asia, while London's West End remains by far the world's most highly priced business district.

These are some of the key findings in CB Richard Ellis Research's semi-annual Global Market Rents survey, released today.

Of the 173 markets surveyed, occupancy costs increased in 119 and decreased in only 24 in the last year.

Much of the global rental growth can be seen in Asia, led by India and China, the world's fastest

growing major economies. With a 69% increase in occupation costs in the last 12 months, Mumbai's (India) Nariman Point submarket has seen the greatest rent appreciation of the locations surveyed. While London's West End, at $186/ sq ft/annum, remains the most ex pensive office market in the world, North American markets including New York, Washington, D.C., Toronto and Calgary remain a relative bargain.

At $93 (occupancy cost in /sq ft/annum used throughout release), Mumbai's Nariman Point broke into the top 10 most expensive markets. Elsewhere in Asia, Hong Kong occupancy costs jumped 50% to $102 over the last year.

Tokyo remains one of the world's most expensive office markets. Occupancy costs in the Inner Central Five Wards, ranked 2nd, increased 8% to $130, while Outer Central costs, the 4th highest, increased 3% to $118.

At $42 and ranked 43rd, Singapore returned to the top 50 after a three-year absence.

In the Pacific Region, Sydney remains the only market to make it into the top 50, coming in at 46'h. But like the rest of the world, office occupancy costs are rising across most of the Pacific Region, albeit at very different rates.

European cities continue to dominate the top 50 list of the most expensive office markets, led by London's West End. Occupancy costs in that district--up 10% since last year--are 30% higher than the next most expensive submarket, Tokyo's Inner Central.

London City has seen occupancy costs rise to $127, a 7% increase in the last 12 months. Of the larger markets, Madrid witnessed the most significant rise in occupation costs, which increased 12% to $54.

Despite rental growth in many North American markets, only four--Midtown Manhattan, Washington, D.C., Toronto and Calgary--are in the current top 50. Washington, D.C., continues to benefit from a steady federal expansion, which is fueling a solid demand for space.

Occupancy in Midtown Manhattan is still the most expensive in the United States at $55. Rio de Janeiro is at $51 and ranked 30th, while Silo Paulo, at $42 and ranked 42nd, returned to the top 50 after dropping off the list four years ago.
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Title Annotation:of occupancy and real estate market
Publication:Real Estate Weekly
Geographic Code:1USA
Date:Jun 21, 2006
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