New York lost its crown as the most expensive prime office market in the Americas, overtaken for the first time by Rio de Janeiro, according to a study by real estate adviser Cushman & Wakefield Inc.
The annual cost of renting a square foot of prime office space in the Brazilian city rose 47 percent last year to $120, or $5 more than in Midtown Manhattan, the broker said in a statement today. Rio de Janeiro advanced to fourth from 13th in a global ranking of prime office markets, coming after Hong Kong, London and Tokyo, Cushman said.
“Very high demand and a lack of supply” powered the gains in Brazil’s second-largest city, Mariana Mokayad Hanania, a research manager for the broker’s South America arm, said in the statement.
Brazil’s economy expanded at an annual rate of 6.7 percent in the third quarter, helped by commodity exports and rising consumer spending. South America registered the highest regional growth in the study, with a gain of 12 percent.
Hong Kong overtook London’s West End district as the world’s most expensive location for prime offices. Rents increased 51 percent last year to $241 a square foot as corporations expanded and new businesses competed for a limited amount of high quality space, Cushman & Wakefield said.
London prime rents rose 27 percent last year to $233 a square foot, the Cushman study showed. That contrasts with an average of 1 percent growth across Europe.
New York advanced to fifth in the global ranking from sixth a year ago after prime rental costs in Midtown Manhattan rose 10 percent to $115 a square foot, Cushman said.
Cushman & Wakefield is the world’s largest privately owned commercial real estate broker and is controlled by Italy’s Agnelli family. (credit C&W)