Manila fell 33 spots in its rank among global cities with the most expensive office occupancy costs, mainly due to the impact of the COVID-19 pandemic, a property services firm said.
In its Premium Office Rent Tracker (PORT) 2021, Jones Lang LaSalle (JLL) ranked Manila 96th most expensive office locations with occupancy costs at $43 per square feet.
This is lower than last year’s 63rd rank at $57 per square feet.
“…Tokyo’s major submarkets and the Southeast Asian hubs Manila and Bangkok have seen their rankings fall as COVID-19 outbreaks and accompanying government-imposed restrictions have negatively impacted office demand in these cities,”JLL said.
New York-Midtown and Hong Kong-Central were ranked as the world’s most expensive office location at $261 per square feet.
Other global locations in the top five include Beijing-Finance Street, London-West End and Silicon Valley.
The report found that key gateway markets are seeing a widening rental gap between central business districts and decentralized submarkets.
“Despite the impact of the pandemic on the office market globally, rental performance in core central business districts has proved resilient relative to decentralized office locations over the past year,”JLL said.
“2021 has seen the rental gap between core and decentralized submarkets widen in the key gateway cities – Hong Kong, New York, Beijing and Tokyo – as core business districts have continued to attract healthy interest from corporate occupiers. Nevertheless, more cost-conscious occupiers which place a greater focus on affordability may find substantial discounts (of 40 percent- 60 percent relative to premium CBD space) in well-located business districts outside of the main CBD within such top-tier cities,”it added.
The seventh edition of JLL’s PORT covered 127 office markets and submarkets in 112 cities.
PORT comprises the key elements of occupancy costs – net effective rent, service charges and government taxes on rent – all standardized on a Net Leasable Area (NLA) basis to enable true international comparisons.