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Entries Tagged as 'Office Space'

The Worlds Most Expensive Markets for Office Space for Lease

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Office space for rent costs worldwideLOS ANGELES, May 05, 2010 (BUSINESS WIRE) -- London's West End remains the world's most expensive office market, according to CB Richard Ellis Group, Inc. (CBRE) Global Research and Consulting's semi-annual Global Office Rents survey. Hong Kong's Central Business District (CBD) has risen to second place pushing Tokyo's Inner Central to third place. Mumbai is now in fourth position on the list while Moscow remains in fifth in the CBRE rankings, which tracks occupancy costs for prime office space in 176 cities around the globe.

Office occupancy costs measured in U.S. dollars are affected by changes in the dollar's value versus the respective local currency. Hence, office occupancy costs when converted into U.S. dollars are driven by both the local market dynamics of supply and demand, as well as currency changes.

"We have found that currency fluctuations play a big role with regard to where markets rank in the top 10 for office costs," said Dr. Raymond Torto, CBRE's Global Chief Economist. "However, the 'most expensive club' still includes the usual names -- London, Hong Kong and Tokyo."

The report also found that on a year-over-year basis, global occupancy costs are searching for a bottom, with the markets monitored revealing a collective drop of -4.6% worldwide over the 12-month period ending March 31, 2010. Larger markets experienced a slightly greater decline of -6.4%. The majority of markets (133) experienced a decline, with 33 of these markets registering double-digit percentage-point drops in office occupancy costs. 53 markets experienced annual increases in occupancy costs, generally smaller markets affected by quality shifts in key market assets...

... North America is led by Midtown New York, which posted an office occupancy cost of US$64.51 per sq. ft. While office occupancy costs in Midtown New York are high for North America, that market ranked just 26th globally.

North America saw a below-average decline of -3.3% (year-over-year), making the region the third weakest with falling occupancy costs in 51 out of 77 markets. The largest declines were in Calgary CBD (-24.9) and New York Downtown (-19%).

Top Ten Most Expensive Markets
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(In US$ per SF per annum)              US$/SF/annum
  1.) London West End, United Kingdom     182.94
  2.) Hong Kong (Central CBD)             153.20
  3.) Tokyo, (Inner Central), Japan       143.99
  4.) Mumbai, India                       125.76
  5.) Moscow, Russian Federation          125.10
  6.) Tokyo (Outer Central), Japan        118.41
  7.) Paris Ile-de-France, France         113.23
  8.) London City, United Kingdom         110.07
  9.) Dubai, United Arab Emirates         108.92
  10.) Sao Paulo, Brazil                  100.00

More...

Bloggers note: It is interesting to see that the major US office space leasing markets are no where close to the top ten in office space rent costs. Midtown Manhattan is only just over 1/3 of the cost of number one London office space rental rates. The other interesting location in the top ten is Mumbai, India, still nearly double the cost of Midtown Manhattan.

 

London Office Space , Manhattan Office Space , New York Office Space , Office Rental , Office Space , UK Office Space

Does Corporate America Have Too Much Office Space?

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Nasdaq 4/30/10 - Corporate America has 25-50% more space than it actually needs, particularly as tenants move toward more open floor plans, more staff work remotely and companies reduce costs by cutting the amount of space allocated per person. That's the view of Howard Ecker , president of Chicago-based tenant representation firm Howard Ecker & Associates . "Companies have gone from offices to cubicles and now they are going to benching," he said.

Space per person has been in the news lately, with Goldman Sachs reducing its space per person from 228 to 178 square feet and famously putting a number of less-senior executives in internal offices without windows when it moved to its new headquarters building in New York. But Goldman isn't the only one. Over the years, law firms have gone from 750 square feet per lawyer to 500. "They are now going down below that," Ecker said. Advertizing agencies once had 250 square feet per person and now have less than 100, he added.

Bob Stella , president of New York-based tenant representation firm Cresa Partners , said more companies have staff that telecommute or use hoteling, where more than one staffer uses the same workspace. "All companies are looking at ways to be more efficient. It's possible to create a great working environment and do it with less space," he added. "You can virtually be working on your laptop from home and perform a lot of the same tasks."

Although the office market isn't there yet, Ecker believes that changing demographics will have the biggest impact on office space needs and cited the emergence of the Echo Boomers, or the Millenials, who are entering the workforce. "Four percent of the workplace is 65 and older and 50% is 45 and under. As they disappear and younger people start to make decisions, the complexion of the office environment will change," he said. "The younger the decision maker, the less space they will take."

In an extreme case, the need for less space could ultimately stamp out new office development, Ecker said. "If we have 25-50% more space than we need, why build another office building? A lot of people say they have to be in new buildings because they are more efficient. But new buildings aren't inherently more efficient," he said. Finally, using less space is also a much greener option. "Green is a really big issue today. The U.S. government can't lease space in a building that isn't LEED certified and they are leading the charge into efficiency," he said. "The greenest thing that can be done is to use less space."

Source: NASDAQ.com

Green Office , Office Rental , Office Space , Office Space Design

Facebook generation will kill traditional offices, says Microsoft

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Study suggests home working and hot-desking will become the norm

The social-networking generation will rely on mobile technology, remote working and 'pop up' offices to get their jobs done, according to a new study backed by public sector think tanks and the Institute of Directors.

The focus of corporate IT departments will shift from supporting dozens of workers in a single office space to facilitating home-based and remote working, and ensuring that staff in temporary, shared offices can get the job done.

"Companies will be a bit more aggressive with how much office space they need," said David Coplin, national technology officer at Microsoft, which contributed to the report.

"The savings in the short term will be around office space. At best 55 per cent of office space is used at any one time, leaving 45 per cent unused," he told Computer Weekly. "That is 45 per cent of your office costs."

The study suggests the companies will benefit from allowing staff to use online collaboration tools and social networks to carry out their work. Knowledge-sharing and collaboration will be made easier by the knew generation of cloud-based computing services and communications networks.

"There is a message here for organisations that block tools like Twitter at the firewall," said Coplin. "You can't do that any more because you are restricting people's activity. Be confident in your security and let go a bit of your control.

"We have talked for a while about the death of the desk phone. Now we are talking about the death of the desk. Its not just about working from home. There are compelling reasons for working from a variety of locations."

Source: Telegraph

Executive Suites , Flexible Workspace , Home Office , Office Rental , Office Space , Virtual Office Space

Volcanic Eruptions Lead to a 230% Increase in Video Communication in the UK

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April 23, 2010 - Regus, the world’s largest executive suite provider, has seen a 230% increase in video communication over the last week in the UK, helping to alleviate the problem of displacement and enabling business to continue as usual.

Since the situation began last Thursday, demand for virtual meetings has been unprecedented. Across Europe week-on-week demand increased by 180%, whilst on Monday calls to Regus call centres were 450% above the daily average.

Source

Executive Suites , Flexible Workspace , Office Space , Serviced Office Space , UK Office Space , Virtual Office Space

38% of an Office is not Utilized Yet Consumes Resources

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National Green Office Week is focusing public attention on the need for greater environmental sensitivity at work.  But if a real green contribution is to be made, then firms need to look at their office facilities and understand the level to which they are really used.

A study by workplace solutions provider Regus has shown that around 38% of office space is not utilised at any given time.  However, from an environmental point of view, that space is being heated, lit and otherwise consuming energy, whether staff are using it or not.  Therefore office businesses in South Africa need to examine the ways in which they provide workspace facilities in order to better align facilities with actual occupancy, and eliminate the wastage of huge amounts of energy each year.

Various studies have identified that each employee in a service industry business consumes energy equivalent to two tonnes of carbon emission each year.  If the Regus study’s findings about office under-utilisation are combined with these third party statistics on employee workspace energy consumption, then across South Africa’s 3 million office workers, over 2 million tonnes of carbon is being unnecessarily emitted every year.  South African businesses are also wasting money on energy consumption for office space that simply isn’t being used Business’s rands-and-cents perspective on green issues is spotlighted by Joanne Bushell at Regus South Africa.

She notes: “Being smart about the workspace you provide delivers ‘greenback’ to the environment and into your bottom line.  How compelling an argument is that?  Good environmental practice is good business.  But it requires businesses to take a step back and strategically review how they provide employees with workspace.
 
Smart firms are already adopting hybrid solutions that relieve them from the wastage inherent in traditional long-term leases.  Traditional office property arrangements may be retained for the inner core of a company’s administration.  However, the recent global recession has taught us all that firms need to become smarter, more agile and able to morph quickly with volatile and rapidly changing markets.  We need to make sure that our workspace arrangements are totally aligned with the ability to scale and change at the rate that keeps business competitive in the 21st century.  In addition, smart, cost-effective workspace solutions cut carbon emissions, energy costs and waste.”

Bushell, Johannesburg-based Regus vice-president, Middle East and Africa, adds: “Local firms are keen to optimise the economic upturn without renting more space and adding to fixed overheads.
 
“Office space is not only a major cost, it’s also a big user of electricity, air-conditioning and heating fuel – again underlining the relationship between the carbon footprint and the bottom line.”

Source: EPROP

Bolgger's note: Although this is specific to South Africa, it can be apllied to office space everywhere else as well.

Green Office , Office Space , Office Space Design , Office Vacancy Rate