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The latest report by CBRE Global Research and Consulting highlights the huge difference in rental costs across the world as well as measuring the rise and fall of rents in comparison with earlier years.
There is little change at the top, with Hong Kong’s commercial property market boosted by an influx of investment from mainland China – where big businesses need a slice of the Hong Kong pie. Behind Hong Kong is London, and specifically, the West End, with rents at US$222.58 per square metre, just under US$13 less than Hong Kong.
Of the other 127 cities examined, Beijing’s financial and business district and New Delhi’s central business district were placed third and fourth, an indication of the surging economies of China and India.
Bangkok came merely 115th, and is the cheapest city in terms of rents in the Asia-Pacific region. However, a lot can change between one year and the next: for example, Jakarta, in Indonesia, has seen rents increase by almost 40% and Manila, the capital of the Philippines by almost 15%.
Sally Brough, Associate Director of Morgan Pryce, comments, “It is interesting to see these figures, which are of course a reflection of the commercial property economy in the respective countries – or at least the capitals of those countries. The figures also reflect what we are seeing ‘on the ground’ in terms of rental rates in the West End. It doesn’t look like London will be giving up its spot any time soon.”
Hong Kong’s figures see it top for the third year running, but there have been indications recently that some companies are relocating to cheaper parts of the city in order to avoid these high rents. If this happens, the central rents may decrease as more space becomes available.
Morgan Pryce is a specialist tenant acquisition agent with offices in Oxford Circus and the City. Morgan Pryce specialises in search, negotiation and project management and works exclusively for tenants.