All eyes are on China lately.
From the lure of its growing middle class to talk of a trade war with the U.S., the country has taken center spotlight for businesses. But footwear retailers eying expansion and office space in China should act fast: Things might get expensive.
That’s according to new figures from commercial real estate services giant CBRE, which found that Hong Kong’s Central District remains the priciest office real estate market in the world.
“Global economic growth has stimulated robust leasing activity, particularly in EMEA and APAC,” said Richard Barkham, global chief economist.
The report looked into “global prime office occupancy costs,” which “reflect rent, plus local taxes and service charges for the highest-quality ‘prime’ office properties.”
Central’s overall prime occupancy costs crowned the report’s most expensive list at $307 per square foot annually, followed by London’s West End at $235 and Beijing’s Finance Street at $201.
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“For the first time in this cycle, prime office occupancy cost growth was consistent across all regions,” Barkham said. “[And while] occupancy cost growth in the Americas slowed slightly compared to a year earlier, it remains the region with the overall largest increase in costs.”
Barkham continued, “The dominant trend among markets with notably rising prime occupancy costs is strong demand from the finance, technology and e-commerce sectors. Markets with declining occupancy costs are primarily affected by supply/demand imbalances resulting from new completions. Since reduced costs due to excess inventory tend to be relatively short-lived, companies looking for space in those markets should move quickly.”
CBRE’s clients include Gap Inc. and Forever 21.
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