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Research by DTZ in the form of the annual ‘Global Office Thermometer’ has shown that occupiers globally are feeling the effects of an overall lowering in office costs. There has been an average fall in costs per workstation worldwide, by 4.4% in 2014.
The fastest decline measured almost twice that in South Asia, with a reduction in costs of 8.3%, reflecting a slowdown in economic growth in the region and depreciation of local currencies against the US dollar.
Europe’s decline reached 7.8%, again due to the value of the euro and economic conditions. The strength of the dollar was reflected in the slight increase in occupier costs across North America, despite some individual cities experiencing a decrease in costs, such as New York (13%) and Atlanta (11%).
Canada, however, saw significant falls in its major cities as Toronto occupier costs decreased by 30% and Ottawa and Montreal both fell 11% on the year before. A similar position was noted in Australia, with Perth, Canberra, Brisbane, Sydney and Adelaide all experiencing a fall in costs.
In Eastern Europe the cities of Bucharest, Bratislava, Kiev and Warsaw saw occupier costs sink 25%, 23%, 20% and 13% respectively, with Moscow seeing a sharp fall of a third.
However, London’s West End topped the global list, increasing to £18,675 per workstation, followed by Hong Kong, which lay behind, as much as a third cheaper than the West End.
Other growth areas included the Middle East and Africa, with Jeddah, Riyadh and Abu Dhabi up, the latter increasing by 36%, the fastest-increasing costs in the world last year.
This news was brought to you by Morgan Pryce, 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.