- While they may house the most expensive offices in the country, Manhattan and San Francisco are still only #6 and #7 in the global arena.
- London, Tokyo and Beijing top the list as the most expensive cities in the world for office space.
- Office rents in Austin and Miami climb to roughly $60 per square foot, passing Sydney and Frankfurt to meet Luxembourg and Boston.
Remote work may be growing in popularity, but office space is still essential for many businesses. In fact, around the world, startups, multinational corporations, and every business in between recognizes that having a space to bring their employees together from time to time not only fosters collaboration, but can also bring teams closer together, thereby helping them to feel fulfilled and productive. Plus, with the shake-up caused by the pandemic, office space in the most prestigious neighborhoods of the most prestigious cities is hitting the market — just itching to be leased.
Premium office spaces in premium cities, of course, come at premium prices. With that in mind, we analyzed office leases in desirable business districts in the top U.S. cities using CommercialEdge data cross-referenced with international lease data from JLL, CBRE and Cushman Wakefield. Our findings shed some light on how much offices cost in the most expensive cities in the world.
Manhattan & San Francisco Have Most Expensive Offices in U.S., but Not Worldwide
When someone says “office,” many of us envision the quintessential office location in Midtown Manhattan. And why wouldn’t you? Don Draper’s office is on Madison Ave., and then there’s 30 Rock, Park Avenue and Broadway. It’s iconic — and the office prices reflect that.
Unsurprisingly, office space in Midtown Manhattan was the most expensive office space in the country at $91 per square foot per year. That price puts you and your company in the best of the best offices in the country — and makes a statement at that. But offices in the SoMa and Menlo Park districts of San Francisco were contenders, as well, with premium offices in these locations leasing for $89 per square foot per year.
Globally, these two economic powerhouses stood right between the likes of Paris and Singapore, which commanded premium office lease prices of $97 and $89 per square foot per year, respectively. And even though office leases in Manhattan haven’t returned to their pre-pandemic levels (because working from home remains quite appealing to many), it’s still the Gold Standard for office space in the entire country.
That said, the most expensive cities for premium offices in the world were a veritable who’s who of global cities — London, Tokyo, Beijing, Hong Kong and Paris, where office square footage can reach staggering heights that nearly double Midtown Manhattan’s.
The Bay Area Still a Top Player in Global Arena of Premium Offices
Despite the highly publicized “flight from Silicon Valley” that we’ve been seeing for the past couple of years, the Bay Area is still a powerhouse of premium office space. In fact, California offices in Palo Alto, Mountain View and Sunnyvale ranked 9th in the world for the most expensive, coming in at nearly $86 per square foot per year — which was on the same playing field as Singapore.
At the same time, the booming Silicon Valley-esque growth has propelled prices in Austin, Texas, to soaring highs that approach the lease rates in Luxembourg, Boston and Milan. Office space in Miami also climbed right behind Austin, surpassing Sydney, Australia, as well as Frankfurt, Germany.
Leasing Premium Office Space Around the World
To put these square footage prices into context, we also considered average office space and what it would cost in the top 10 premium office markets with all else being equal. Specifically, the average number of workers in a particular office is about 24 and the average amount of office space per employee is 250 square feet. Therefore, the average office size is roughly 6,000 square feet — a little bit larger than a basketball court — and includes basic workstations; a meeting room or two; a kitchen; and at least one common area. With this in mind, we explored how much the average business owner would have to pay in the most prestigious centers of commerce in the world.
To that end, at $163 per square foot per year, the average office space in London’s West End leased for nearly $1 million. By comparison, offices here were 32% more expensive than the likes of the second-most expensive location, Tokyo’s Marunouchi commercial district, which came in at $123 per square foot per year.
The same space went for $740,880 per year in Tokyo and roughly $670,200 in both Beijing and Hong Kong. That said, even in top U.S. markets, that same space would lease for $547,333 in Manhattan — less than 56% of the cost in London’s West End. Office space in Dallas was even less, with 6,000 square feet of premium office space leasing for $207,900 — just 24% of the price in London and on par with cities like Shenzhen, China, and Mumbai, India.
Meanwhile, filling the gap between the Bay Area’s $86 per square foot and Vancouver’s $67 per square foot was office space in Toronto’s Financial Core. It approached $72 per square foot per year to come in 10th overall, leasing 6,000 square feet for $430,000 per year.
Regardless of where these cities fall on the international scale, they all offer some of the most prestigious, luxurious and impressive offices in the world. As such, choosing one of these locations for your business definitely makes a statement.
Lease rates for all international markets were obtained from Q1 2022 Market Reports from CBRE, Cushman & Wakefield, and Jones Lang LaSalle for premium, Class A and trophy properties in the most desirable commercial districts in each city.
Lease rates for all U.S. markets were from Q1 2022 and were obtained from CommercialEdge.
All rankings are based on full service equivalent rates.