Hong Kong World's Most Expensive Office Space

Hong Kong is now the most expensive place in the world to rent an office, according to a new report from property firm Cushman and Wakefield.

The report measures the most expensive business locations in sixty eight countries and regions. Hong Kong leapt above Tokyo and London to gain top spot.

Our Dominic Swire explains.

You won't fit much more than the office printer within a square metre. But in Hong Kong this amount of space could set you back up to 1,800 US dollars per month. The city has recently been identified as the most expensive in the world to rent an office by property firm Cushman and Wakefield. Andy Zhang was the main man behind the research. He says he wasn't surprised about the findings.

"For Hong Kong to over take over London, New York, Tokyo, that, to some extent, is probably a surprise to most of the world."

Andy Zhang says Hong Kong has benefited from economic growth on the mainland. Another factor behind the high prices is a lack of space. The region covers around 1,000 square kilometers, half the size of Tokyo. Despite the small size and high prices, Andy Zhang says there are many reasons why companies come to Hong Kong.

"Hong Kong has always had an attraction given its legal system and its proximity to the mainland market. Historically, Hong Kong has been such an international city especially for the financial industry."

Cushman and Wakefield research says the most expensive commercial property in Hong Kong is the International Finance Centre, a skyscraper which costs over 22 thousand dollars per square meter per year. The equivalent price in Shanghai is 900 dollars. But despite such prices, Andy Zhang plays down fears about a bubble.

"The commercial real estate market is very healthy, there's a very strong demand, a limited quality supply and these are the fundamental factors. So I believe the commercial real estate market in Beijing and Shanghai and Hong Kong, even now the price is now ranking the number one in the world is well supported by market demand."

Andy Zhang says commercial real estate in Hong Kong, Shanghai and Beijing is likely to get even higher over the next few years due to a lack of new office supply.

For CRI, I'm Dominic Swire.