Other cities to report increases greater than 10% in occupancycosts were New Delhi and Hong Kong. The most expensive US locationis now Midtown Manhattan, which ranks 20th at $52.04 per sf.

Over the past three years, there have been only nine changes inthe top 50 most expensive cities. "Nearly all of these have beenEuropean cities that have entered the top 50 at the expense of UScities," says the report. "The sharp fall in the value of thedollar since mid 2003 and significant falls in rental valuesfollowing the dot-com crash in 2001 and the subsequent economicdownturn have left US markets looking very cheap to those elsewherein the world." There are now only four US locations in the top 50compared to 10 about three years ago.

The contrast with London could not be sharper. The West End notonly remained the world's most expensive office location at $177.39per sf but with a much increased margin. The increase is due partlyto a slight increase in the value of sterling against the dollar.But it is also due to a sharp rise in prime office rents in WestEnd offices over the past six months. There is now a 48% differencebetween occupancy costs in the West End and the second mostexpensive location, the City of London, where costs are now $119.49per foot.