Global offices set for rental growth and increased capital values

CBRE report findings point to continued recovery for worldwide office market

Article posted: 29 May 2011

Rises in both global office rent and capital value indices point to continued recovery for the worldwide office market, according to CB Richard Ellis.

Having expanded for the second quarter in a row, the CBRE Global Office Rent Index rose 4.3% year-on-year in the first quarter of 2011 (Q1) following a rise of 2.4% in Q4 2010. The CBRE Global Office Capital Value Index expanded 12% year-on-year during Q1 2011, and has been in recovery mode for a year now.

The Europe, Middle East and Africa (EMEA) region showed positive rental increases at 2.5%, having already experienced a more moderate descent from its peak.

Richard Holberton, Director of EMEA Research, CBRE, said: “Rates of rental and capital value change in the EMEA region are currently modest. While we are still seeing some capital uplift from yield improvements, these have eased as investors assess the likely implications of both earlier value growth and lingering economic risks. While few markets are now seeing any decline in prime rents, clear evidence of growth is confined to a small number of the stronger cities such as London, Paris, Berlin and Stockholm.”

Figures released earlier this month by Knight Frank showed that office space in the West End of London overtook Tokyo as the most expensive in the world during 2010. The figures were revealed by Knight Frank’s Global Real Estate Markets Annual Review & Outlook 2011, which reviews current conditions in commercial property markets across the globe and surveys office rental levels in 105 international markets.

For breaking news relating to office space in the UK follow us on http://twitter.com//officespacenews

Posted by Sara