Where in the World are The Most Expensive Office Areas?

Where in the World are The Most Expensive Office Areas?

Jones Lang LaSalle research reveals the world’s most expensive markets for office space and how New Zealand compares.

Strong demand from niche financial and technology sectors is driving up the price of office space in many cities around the globe. New research by Jones Lang LaSalle reveals the 12 premier office districts that have been the biggest beneficiaries of the trend, witnessing higher competition by companies for space and driving rent prices to new highs. Also, how does New Zealand compare next to the world's priciest places to work?!

Mark Grant, National Director of Markets for Jones Lang LaSalle, says, “Auckland is the most expensive city for office area in New Zealand and yet would need to increase by more than 400% in order to come close to St James’s figure per sqm. This is certainly evidence of the fact that within Auckland, when the quality of the work force and exceptional natural amenity are considered – the market offers exceptional value for international office occupiers.”

Jones Lang LaSalle’s list of the “World’s Most Expensive Office Areas” reflects a variety of global and regional economic trends and highlights the key factors companies consider when seeking premier office space. All 12 of these office districts are within the world’s most internationally connected and easily accessible cities, which are home to a large number of top global corporate headquarters and hence the world’s top talent and not to mention large numbers of high net worth individuals.

Here are the top five of the most expensive office areas for 2013:

1. LONDON (UK): St. James’s – NZ$2,846 per sqm

Topping the list is St James’s in London’s West End, home to hedge and sovereign wealth funds, and niche wealth and investment managers. The area enjoys unparalleled luxury amenities and proximity to clients.

2. HONG KONG (China): Central -- NZ$2,076 per sqm

Central is the place to be for this international financial center’s banking and finance community. The area offers first-class hotels, luxury retail (shopping has been called a ‘serious sport’ in Hong Kong), excellent transport links and interconnecting walkways, which can be particularly welcoming on hot and humid summer days.

3. BEIJING (China): Finance Street -- NZ$1,756 per sqm

This Beijing submarket was planned and built specifically to attract the highest-tier financial institutions. Major state-owned enterprises, global investment banks and insurance companies have accepted the invitation.

4. GENEVA (Switzerland): Rue du Rhône -- NZ$1,486 per sqm

Rue du Rhône is Geneva’s prime location for banks and private wealth-management firms. Luxury retail outlets help to keep some of the wealth in circulation.

5. SILICON VALLEY (USA): Menlo Park -- NZ$1,422 per sqm

Sand Hill Road in Menlo Park is home to many of the venture capitalists who have made Silicon Valley the epicenter of the technology universe.

In comparison, New Zealand’s most expensive office areas are:

1. AUCKLAND: CBD -- NZ$555 per sqm

The most expensive city in New Zealand, but over 80% cheaper than St James’s in London and almost 75% cheaper than Hong Kong. However, cost of occupancy in the New Zealand’s largest city is forecast to rise over the coming three years, with a lack of new supply the driving factor.

2. WELLINGTON: CBD –NZ$460 per sqm

In comparing like with like, Wellington, a predominately, gross lease market, shows its value of being close to 20% less expensive when looking at the net cost compared to Auckland, and almost 85% cheaper than central London. Premium space in the capital is tightening as tenants look for quality, seismically strong premises.

3. CHRISTCHURCH: Frame –NZ$425 per sqm

The cost of development and the lack of quality space since the earthquakes have changed the face of the city forever. With new developments finally coming to fruition, tenants looking to occupy new premises in key locations are setting the benchmark rents for this space.

To view the full list click here.

© Scoop Media