While most businesses try to have their physical presence at prime commercial locations, the rents in an upmarket place can be prohibitively high for many of them. It is for this reason that companies or businesses that are able to afford to mark their presence in such destinations take pride in doing so. We take a look at the 10 most expensive commercial real estate hubs in the world, according to a report by the US-based property consultant CBRE.
These cities are also the most sought after office markets in their respective countries:
1 Hong Kong-Central
Hong Kong-Central has been the most expensive commercial property location in the world for decades now. The real estate prices in the almost the whole of Hong-Kong are pretty high since the beginning which has forced the city to go vertical in terms of construction of buildings. Hong Kong-Central, in particular, has seen very high rentals because of the presence of the largest banks and finance companies. It is in Hong Kong-Central that new and innovative banking products and offerings are thought of and then introduced to consumers across the world to drive profitability of the banking sector year-after year. The rental levels in Hong-Kong Central stand at USD 307 per square feet, according to a report.
2 London-West End, United Kingdom
London-West End, United Kingdom again owes its high real estate values to the banking industry. Significant presence of global banks in London-West End for many decades now have ensured that this area has very high price tag for each inch of space here. London-West End too decides what new bank offers and banking products will be used by the consumers across the world. The rental levels in London-West End stand at USD 235 per square feet.
3 Hong Kong-Kowloon, Hong Kong
Hong Kong-Kowloon is the second place in Hong Kong which has consistently found place among the top 10 expensive commercial places in the world. Real estate prices in Hong Kong-Kowloon are powered by heavy presence of the banking industry here. The rental levels in Hong Kong-Kowloon stand at USD 190 per square feet.
4 New York-Midtown- Manhattan, USA
New York-Midtown-Manhattan has to be among the top 10 expensive locations because of presence of large technology and IT firms, apart from traditional industries like banking. The companies present here have constant expansion needs and that has pushed the rentals to about USD 183 per square feet.
5 Beijing-Finance Street, China
Beijing-Finance Street has been among the five most expensive locations for business consistently for years. This place is symbolic of the transition that most cities in developing countries have seen from local economies to global metropolitans. Beijing-Finance Street has presence of the largest banks, IT and export-oriented companies. The rental levels in Beijing-Finance Street stand at USD 265 per square feet.
6 Beijing-CBD, China
Beijing-CBD is the fifth most expensive office location with its sky-scrappers. The capital of the second largest Asian economy has seen rents climbing up every six-month period in the last 30-40 years. The location accommodates a number of new-age industries like the IT, exports and electronics, apart from banking. The rental levels in Beijing-CBD stand at USD 189 per square feet.
7 New York-Midtown-South Manhattan, USA
Another commercial hotspot in New York finds place in the top 10 in the world in terms of expensive real estate hub. New York-Midtown-South Manhattan is a sought after location for businesses to be in. Companies present here have seen their proliferation from startups to large corporate over the last couple of decades or so. The rental levels in New York-Midtown-South Manhattan stand at USD 172 per square feet.
8 Tokyo-Marunouchi/Otemachi, Japan
Tokyo-Marunouchi/Otemachi is another most expensive commercial real estate hub in the world. It has presence of companies that dictate technology that will be used by the world. Large technology companies have their headquarters here, even though their manufacturing units may be located in remote areas. This commercial hub has presence of large banks as well. The rental levels in Tokyo-Marunouchi/Otemachi stand at USD 171 per square feet.
9 New Delhi-Connaught Place-CBD, India
New Delhi-Connaught Place-CBD has been a prime banking and shopping destination since the time Britishers ruled India. The New Delhi-Connaught Place-CBD today has IT and real estate companies also, apart from large banks. Delhi is among the cities where you will find the highest commercial rent in India. The rental levels in New Delhi-Connaught Place-CBD stand at USD 153 per square feet.
| Explore commercial properties in New Delhi-Connaught Place-CBD, (India)
Commercial Properties In New Delhi |
See also: Commercial property vs residential property: Which rental income is more attractive?
10 London-City, United Kingdom
Another location in London which ranks among the top 10 commercial locations in the world is London main city. The location has regional headquarters of banks and MNCs, apart from various entertainment, real estate and IT companies. The rental levels in London-City stand at USD 145 per square feet.
The report also highlighted that six of the most expensive commercial real estate markets in the world are in Asia. As per the report, Mumbai’s Bandra Kurla Complex (BKC) and Nariman Point CBD were ranked at 27th and 40th positions in the list, respectively. These localities have the most expensive commercial real estate properties in the cities.
The locations listed above have seen high occupancy levels throughout with many companies waiting to seize an opportunity to locate themselves here. The rents have always moved northwards year after year in these locations, if not every six months. Space requirement and occupancy by the banking sector in most of these locations have been the reason for such dizzying levels of rents, although new economy is also now making its effect felt. Some start-ups have been able to expand fast and become MNCs and are now placing themselves in these locations in the last decade.
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