BKC, Nariman Point slip in most expensive office space ranking

Mumbai: The city’s prime commercial destinations BKC and Nariman Point dropped in rankings of most expensive office markets globally, even as Delhi’s Connaught Place continued to figure in the top 10, a survey said. According to a research by property consultant CBRE, Delhi’s Connaught Place was the sixth most expensive office market in the world during third quarter of 2015 at rentals of USD 151.27 per sq ft per annum. At about USD 94 per sq ft per annum, Bandra Kurla Complex (BKC) office market was ranked 18th. This is a drop of 3 spots from the last survey in June 2015. The plush Nariman Point also witnessed a marginal drop of two places to number 32 at about USD 72 per sq ft per annum. [caption id=“attachment_564681” align=“alignleft” width=“380”]  Picture: Unlisted Sightings/Flickr ( Creative commons)[/caption] “The drop in ranking for BKC is owing to a marginal decline reported in other cost components such as property tax and service charges, even as overall rents have mostly remained stable. “On the other hand, rents and other real estate cost indicators were mostly stable for Nariman Point during the review period. However, a drop in ranking is due to a relative improvement in the ranking of other global markets,” CBRE South Asia Chairman and Managing Director Anshuman Magazine said. London’s West End was the world’s highest-priced office market for the second straight year with overall prime occupancy cost of USD 273 per sq ft per year. Hong Kong’s Central stood at the second place with prime occupancy costs of USD 269 per sq ft per year while Beijing’s Finance Street with prime occupancy costs at USD 191 ranked third. Beijing’ Central Business District stood fourth at a rental of US 183 per sq ft per year and Hong Kong’s West Kowloon was at fifth place with occupancy cost of USD 162 per sqft per year. Prime occupancy costs – which reflect rent, plus local taxes and service charges – increased 2.4 per cent per annum globally, as the world economy continued to improve gradually and the service sector, a key bellwether for prime office space, entered its fourth year of expansion, driving healthy demand for space in top-quality properties. “The global services sector has grown steadily for four years now, which helps to explain the general uplift in office rents and costs we are seeing worldwide,” CBRE’s Global Chief Economist Richard Barkham said. He further said that despite the fact that some markets have been hit by a slowdown in China and commodities, most advanced economies will keep growing in 2016 and 2017, which combined with limited availability and relatively muted development levels, will result in moderate 2-3 per cent cost increases. PTI