The Olympic Games have prompted Cushman & Wakefield to release its Going for gold in the global office market report, which finds Beijing’s office market is taking out first place.
The report measures 100 global office markets in terms of value growth over the past 12 months; rental or yield recovery since the global downturn; and values for these criteria using A Grade rents, cap rates and yield data as of mid-year 2012.
These parameter values have been converted to reflect a comparable net basis and ranked according to the level of rental growth and yield change in the year to June 2012; the degree of recovery in rental values and yields since the market low point in 2009/10; and the rental and yield value achieved as at June 2012.
‘Medals’ have been awarded to the highest ranking markets, with the top 10 percent awarded ‘gold’, the following 10 percent receiving ‘silver’ and the third 10 percent ‘bronze’.
Beijing tops the performance table, receiving five out of six possible ‘golds’. According to the report, Beijing’s fast-paced growth has contributed to a strong recovery and it has sustained high rental and capital values.
Behind Beijing is San Francisco, the result of growth in its technology base.
Moscow is in third place, driven by high rents sustained by demand and its commodity-led economy. The report says this market has seen a strong recovery since 2010 where rents decreased by more than 50 percent.
Following Moscow are London and Shanghai. According to the report Shanghai has seen the second-highest rental recovery behind Beijing, but yields are ‘edging out’ in 2012 and impacting capital value recovery.
The top 10 cities
| Position |
City |
No. of
‘gold medals’ |
No. of
‘silver medals’ |
No. of
‘bronze medals’ |
Total ‘medals’ |
| 1 |
Beijing,
China |
5 |
0 |
1 |
6 |
| 2 |
San Francisco,
US |
4 |
0 |
2 |
6 |
| 3 |
Moscow,
Russia |
3 |
2 |
0 |
5 |
| 4 |
London,
UK |
3 |
1 |
0 |
4 |
| 5 |
Shanghai,
China |
3 |
0 |
1 |
4 |
| 6 |
New Delhi,
India |
3 |
0 |
1 |
4 |
| 7 |
Taipei,
Taiwan |
3 |
0 |
0 |
3 |
| 8 |
Paris,
France |
2 |
1 |
2 |
5 |
| 9 |
Sao Paulo,
Brazil |
2 |
1 |
1 |
4 |
| 10 |
Bogota,
Columbia |
2 |
0 |
0 |
2 |
Source: Cushman & Wakefield
Sydney, Perth and Adelaide crept into the top 60 – each city was awarded two medals, but no gold.
| City |
Short term growth |
Values |
Recovery since 2009 |
Total ‘medals’ |
|
Rent |
Yield |
Rent |
Yield |
Rent |
Yield |
|
| Sydney |
0 |
0 |
Silver |
0 |
Bronze |
0 |
2 |
| Perth |
Silver |
0 |
Bronze |
0 |
0 |
0 |
2 |
| Adelaide |
Silver |
0 |
0 |
0 |
Silver |
0 |
2 |
Source: Cushman & Wakefield
