New Delhi: Connaught Place in the national capital has become the world's fifth most expensive office location, beating the central business districts of Russia, Japan and China, according to property consultant Cushman & Wakefield.
London's West End is the most expensive office market for the third consecutive year globally. "Connaught Place in New Delhi has emerged as the 5th most expensive office space location in the world," C&W said in a statement. C&W's annual global survey is based on office rental values at the end of 2014.
Connaught Place or CP -- developed as a showpiece of Lutyens' Delhi -- was ranked seventh in the 2013 list. Its ranking has improved on account of renewed demand and strengthening economic environment.
Connaught Place has been commanding a rental value of Rs 412 per sq ft a month and has seen a rental value increment of less than 1 per cent over the previous year.
Hong Kong's CBD (central business district), New York's Midtown (Madison/ 5th Avenue) and Rio de Janeiro's Zona Sul. are at 2nd, 3rd and 4th positions.
While CP is the 5th most expensive office location, Moscow's CBD is ranked 6th, Tokyo CBD (5 Central Wards) is placed at 7th slot, Beijing's CBD 8th, Sydney CBD 9th and Paris CBD at 10th, C&W said.
The consultant noted that Connaught Place has been witnessing high rentals for reasons of limited supply of grade A office space in the area.
With limited to no availability of office space, it said that there have not been any significant transactions, keeping rentals value stable. The CP area is witnessing some latent demand from sectors such as BFSI for front office operations, consulting and media houses etc interested in paying high rentals for aspects such as ease of location, proximity to government and quasi-government establishments and other related businesses, the consultant noted.
Commenting on the Indian office space market, C&W Executive Managing Director, South Asia Sanjay Dutt said: "With renewed economic confidence in the market, the office space transactions have increased by approximately 28 per cent.
"The net absorption has increased by 18 per cent and was recorded at 32.4 million sq ft. We expect the market to remain at least at the same level of activity by the end of 2015."
Stating that large occupiers are consistently moving out of CBD to Secondary Business Districts or other new office locations, Dutt said: "CBD¿s across India have been witnessing stable to stagnant rental values and in some examples such as Nariman Point in Mumbai has seen a decline."