The cost of leasing prime office space is rising faster in downtown Vancouver than anywhere else in North America.
But despite the 16.1% rise this year, the city remains less expensive than Toronto.
New figures from CBRE show that downtown Vancouver’s increase to U$47.95 per square foot is overshadowed by the $56.24 psf cost in downtown Toronto.
However, neither make the top 10 most expensive prime office markets in the world which are led by the U$306.57 psf cost of central Hong Kong and include Midtown Manhattan, which at $183.78 is the priciest in North America.
Challenge for businesses, great for investors
While the rise in costs of leasing in Vancouver will mean changes for business budgets, it is also good news for building owners.
“For investors, these increases offer a great opportunity because we expect rental rates to continue to increase as demand shows little sign of retreat and there is no new supply expected until 2021. We have a robust office market that is short on supply, heavy on demand and a strong provincial economy. The fundamentals are solid for investors buying office buildings in Vancouver,” said Norm Taylor, Executive VP and Managing Director for CBRE Vancouver.
Vancouver’s price rise is the fourth highest globally behind Durban, South Africa (21.4%), Bangkok, Thailand (16.9%), and Marseille, France (16.7%).
Top 10 Most Expensive Markets
(In US$ per sq. ft. per annum; as of Q1 2018)
|
Rank |
Market |
Occupancy Cost |
|
1 |
Hong Kong (Central), Hong Kong |
306.57 |
|
2 |
London (West End), United Kingdom |
235.01 |
|
3 |
Beijing (Finance Street), China |
200.91 |
|
4 |
Hong Kong (Kowloon), Hong Kong |
189.56 |
|
5 |
Beijing (CBD), China |
189.44 |
|
6 |
New York (Midtown Manhattan), U.S. |
183.78 |
|
7 |
New York (Midtown-South Manhattan), U.S. |
171.56 |
|
8 |
Tokyo (Marunouchi/Otemachi), Japan |
171.49 |
|
9 |
New Delhi (Connaught Place - CBD), India |
153.26 |
|
10 |
London (City), United Kingdom |
144.95 |
