Mumbai, Delhi among top 10 costliest global office markets

Bangalore: Mumbai and New Delhi have been placed at seventh and tenth places, respectively, in the ranking of the world’s most expensive office markets, says a survey conducted by CB Richard Ellis Group (CBRE), a Los Angeles-based global commercial real estate service firm.

In its bi-annual survey, “Global Market View, Office Occupancy Costs”, CBRE said Mumbai dropped to seventh place from sixth, while New Delhi climbed to tenth place from 12th. Delhi has re-joined the top 10 ranking of most expensive market list after two years, said Anshuman Magazine, chairman and managing director of CBRE (South Asia).

Though the rentals in the Delhi central business district (CBD) have remained stable for the past six months, he said it has moved up to the tenth position primarily due to office rentals declining significantly in other global cities.

“From the third quarter of 2009 onwards we have seen corporates coming back into the market and office space take-up has improved. To reduce office occupancy costs further and facilitate more supply of office space we need to urgently improve our infrastructure and amenities. This would bring our world ranking down further and make India more competitive,” said Magazine.

Tokyo’s Inner Central, which was at number one in May this year, has slipped to second place, followed by that city’s Outer Central market. Hong Kong’s CBD and Moscow are fourth and fifth, respectively, in the report, which tracks office occupancy costs in nearly 180 cities around the globe. London (West End) stood first in the ranking list with an occupancy cost of $185 per sq ft, followed by Tokyo (Inner Central) at $172 per sq ft and Tokyo (Outer Central) at $139 per sq ft. The occupancy cost of Hong Kong stood at $138 per sq ft, followed by Moscow at $132 per sq ft and Paris at $122.51 per sq ft.

Mumbai’s occupancy cost touched $121 per sq ft, followed by Dubai at $108.91 per sq ft and London (City) at $108.83 per sq ft. Bagging tenth place, New Delhi’s occupancy cost stood at $89 per sq ft.

Office markets worldwide are experiencing declines in prime office occupancy costs. The year-on-year change in prime office occupancy costs of the 179 markets monitored revealed an average drop of 7.7% worldwide over the 12-month period ending September 30, (in local currency and on an un-weighted average basis). The majority of markets — 131 markets in total —…