CBRE: Manhattan Prime Office Rents Among World’s Highest
North America’s most expensive office market, midtown Manhattan, ranked sixth globally with rent exceeding $144 per square foot, reported CBRE, Los Angeles.
CBRE’s Global Prime Office Rents survey said two other Manhattan submarkets, Midtown-South and Downtown Manhattan, also ranked among the 50 most expensive office markets worldwide.
Globally, prime office rents–which reflect rent excluding local taxes and service charges for the highest quality office properties–rose 2.3 percent compared with a year ago, CBRE said. Rents in the Americas and the Asia-Pacific region rose 1.8 percent each while the Europe-Middle East-Africa region saw prime office rents increase 3.7 percent.
“We expect the global economy to pick up momentum with growth boosted by fiscal expansion in the U.S.,” said CBRE Global Chief Economist Richard Barkham. “Growth was underpinned by positive monetary conditions in Europe and increased government spending in China, both of which are expected to continue.”
CBRE tracks office rents for prime office space in 121 markets worldwide. It said 20 of the top 50 most expensive markets were in the Asia-Pacific region, followed by 19 in Europe-Middle East-Africa and 11 in the Americas.
In the Americas, three markets–downtown Chicago, suburban Seattle and downtown Seattle–showed double-digit prime office rent growth year-over-year. CBRE credited a lack of new construction in Chicago and technology investment in Seattle for the strong growth.
Overall, office rents increased in 19 of the 34 U.S. markets CBRE examined.
In addition to the three Manhattan submarkets, CBRE said six more U.S. markets ranked in the top 50 most expensive office markets globally:
–Downtown San Francisco at $88.55 per square foot
–Downtown Boston at $76.25 per square foot
–San Francisco’s Peninsula at $75.57 per square foot
–Suburban Los Angeles at $63.88 per square foot
–Downtown Washington, D.C. at $59.49 per square foot
–Downtown Seattle at $45.88 per square foot
Several markets dependent on the oil and gas industry experienced lowered prime office rents, including downtown and suburban Calgary, Alberta and downtown Houston and Denver.
