C&W's Business Space Across the World, which ranks the most expensive locations for occupying office space in 47 countries, found that Midtown Manhattan office space is a bargain when compared to its international competitors. It is only the fourth most expensive city in the world, behind London, Paris and Tokyo.
CBRE reports that the weakness of the US dollar during the second half of 2004 has had a significant impact on the CBRE Global Top 50. And Cushman found that at year end 2004, office rents increased or were stable in local currency terms in two-thirds of the 210 locations monitored, compared with 2003's 50%.
CBRE says the top 50 cities are "fairly stable"--the first top six cities for 2003, remained in place for 2004 and there's only new entrant, Ottawa. Hong Kong and Toronto also moved up seven places in the rankings and the biggest gain was for Halifax, Canada. In the largest fall, Lima, Peru went from 114 to 130.
According to C&W, Hong Kong showed the most improvement in the rankings, rising 12 places to take the No. 5 slot. Hong Kong improved its position as a result of rents rocketing 109 percent in local currency terms last year.
"The report shows that the revival of the world's economies is finally filtering through to the top-end of the office real estate sector, with increased demand for modern space in the right location driving up occupancy costs," says Elaine Rossall, Cushman & Wakefield's head of business space research. "Further evidence is also emerging of a 'dual' market, as secondary properties, which don't match the needs of the modern office tenant, look set to remain in oversupply for some time."
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