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14 February 2017
Written by Chloe Beevers
The cost of office space around world can differ significantly. The latest figures from property firm JLL for quarter one of 2016 found that New York had the most expensive office space.
They were joined in the top five by Hong Kong, London, Beijing and Shanghai respectively. Unsurprisingly, these are known as the most globally connected cities and continue to have low vacancy rates. In the top 10, Asian cities make up five with Delhi and Tokyo also in there alongside San Francisco, Moscow and Dubai. A little look at the top five in detail:
As a self governed region on the South coast of China, the city has one of the World’s leading financial hubs with a capitalist service economy, low tax rates and free trade.
Voted the world’s most competitive city, London is Europe’s number one office location offering leading talent, strong transport links and huge opportunities for growth.
NYC offers some of the world’s best people and infrastructure as a global hub for international business. The prestige of operating an office in Manhattan can often outweigh the cost of real estate.
Home to as many Fortune 500 headquarters as anywhere else in the world, Beijing has real economic influence. With seven UNESCO World Heritage Sites, it’s a desirable location for business and culture.
As the largest city in the world by population, Shanghai has a lot to offer including the Free Trade Zone (FTZ). There are two commercial districts to choose from: Puxi, west of the Huangpu river and Pudong, east of the Huangpu.
According to the previous research, London office space costs, on average, $240 (£184) per square foot a year after calculating net rent and additional costs. This isn’t too different to the price suggested for renting a space as detailed in the findalondonoffice.co.uk guide (below).
Depending on the size of your company, the number of square feet needed varies. Zoopla suggests a standard office for five requires 150 square feet. That would cost £14,850 a year in any of the areas costing £99 per square foot, such as Marylebone or Covent Garden, rising to £22,350 for a similar office space in St James’s or Mayfair.
This is, of course, for ‘top quality’ offices but another study showed average costs to be around £52.50 per square foot a month in London. By contrast, costs in other cities around the UK and Ireland are significantly cheaper. According to the Colliers office rent map for 2016 (based on prime location, 10,000 square feet units on a 10-year term) prices are as follows:
Balancing the books as a business is imperative but we can see the difference in the cost of an office around the UK and Ireland. Of course, in better-connected cities with more investment and larger companies, the prices are higher but, on average, it is just £22.71 per square foot per month.
Considering starting your own company? Check out this UCL study about the best places to kick-start your business based on a number of factors. Bristol, Greater London and Birmingham come out on top in terms of the best locations for start-ups, although there’s plenty of other options available for office locations around the UK.
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