Bengaluru, Delhi and Mumbai CBDs top prime office yields earners in the world: Knight Frank Global Cities - The 2018 Report

Transcription

1 Bengaluru, Delhi and Mumbai CBDs top prime office yields earners in the world: Knight Frank Global Cities - The 2018 Report Bengaluru s Whitefield is the most affordable tech district among 29 global tech hubs in the world. Gurugram s Cyber City (USD 20.40) pips Madrid s Julian Camarillo area (USD 13.65) and Kuala Lumpur s Cyberjaya Office Market (USD 11.55) in office rents. Mumbai ranks 6th on the Skyscraper Index growth in six months to the quarter ending June 2017, beats London (0.0%), Hong Kong (1.1%), Tokyo (0.0%) and Dubai (0.0%) in rental growth Mumbai, September 28, 2017: Knight Frank presents the future of real estate worldwide in the fourth edition of the Global Cities: The 2018 Report. The flagship global report reveals the trends shaping 40 leading international cities across the globe. Key Findings: Overview Three Indian metros Bengaluru, Mumbai and Delhi earned the highest prime office yields among 34 leading international markets. Bengaluru topped the table with 10% yields followed by Delhi (9.20%) and Mumbai (8.50%) PRIME OFFICE YIELDS INDEX Ranking City Prime office yield 1 Hong Kong 2.70% 2 Paris 3.00% 3 Zurich 3.00% 4 Berlin 3.25% 5 Tokyo 3.30% 6 Singapore 3.30% 7 Frankfurt 3.80% 8 Madrid 3.90% 9 Amsterdam 4.00% 10 London (City) 4.25% 11 New York 4.30% 12 Dublin 4.50% Page 1/8

2 13 San Francisco 4.50% 14 Boston 4.60% 15 Seoul 4.66% 16 Los Angeles 5.00% 17 Seattle 5.00% 18 Sydney 5.06% 19 Washington DC 5.10% 20 Melbourne 5.25% 21 Miami 5.50% 22 Shanghai 5.60% 23 Chicago 5.60% 24 Austin 5.80% 25 Manila 5.90% 26 Beijing 6.00% 27 Dallas 6.00% 28 Brisbane 6.38% 29 Kuala Lumpur 6.50% 30 Bangkok 7.00% 31 Pittsburgh 7.50% 32 Mumbai 8.50% 33 New Delhi 9.20% 34 Bengaluru 10.00% TECH DISTRICTS Bengaluru s Whitefield is the most affordable tech district among 29 global tech hubs in the world. Ranking 25th on the Tech Districts Index, Gurugram s Cyber City (USD 20.40) beats Madrid s Julian Camarillo area (USD 13.65) and Kuala Lumpur s Cyberjaya Office Market (USD 11.55) in office rents. Sr no City Tech District Prime Rent (US$ per sq ft) 1 London Shoreditch San Francisco Mid-Market Dublin Docklands CBD : Rama 1, Sathorn, Sukhumvit Soi 4 Bangkok Paris 1st, 2nd and 9th Districts (Cité Financière) 74.00

3 6 Boston Seaport District Los Angeles Playa Vista New York Brooklyn Beijing Zhongguancun Washington DC NoMa (North of Massachusetts Avenue) Austin The Domain Seattle South Lake Union Dubai Dubai Media City Singapore One North Berlin Potzdammer Platz Toronto King & Spadina Hong Kong Cyberport, Pokfulam Miami Coconut Grove Chicago Fulton Market District Amsterdam City Centre Sydney Pyrmont Melbourne Richmond Shanghai Zhangjiang Hi-Tech Park Mexico City Santa Fe Delhi Gurugram (Cyber City) Seoul Guro-gu (Guro Digitial Complex) & Geumcheon-gu (Gasan Digital Complex) Madrid Julian Camarillo area Kuala Lumpur Cyberjaya Office Market Bengaluru Whitefield 9.65 SKYCRAPER INDEX Mumbai ranks 6th on the Skyscrapper Index growth in six months to Q Prime office rents in the upper floors of high rises in Mumbai see 1.8% growth, among the top six international rent appreciating markets India s financial capital pips iconic global destinations such as London (0.0%), Hong Kong (1.1%), Tokyo (0.0%) and Dubai (0.0%) Established office markets such as Singapore (-0.9%) and Kuala Lumpur (-0.8%) see negative

4 Sr no City Rent (US$ / sq ft / per annum) % growth in six months to Q2 2017* Growth rank 1 Hong Kong $ % 9 2 New York (Manhattan) $ % 7 3 Tokyo $ % 10 4 San Francisco $ % 4 5 London (City) $ % 10 6 Sydney $ % 5 7 Boston $77 0.0% 10 8 Shanghai $67-3.9% 23 9 Singapore $66-0.9% Beijing $66 7.6% 2 11 Chicago $62 1.6% 8 12 Paris (La Défense) $58 0.0% Toronto $ % 1 15 Melbourne $56 4.6% 3 16 Mumbai $56 1.8% 6 14 Frankfurt $54 0.0% Los Angeles $45-2.2% Dubai $44 0.0% Taipei $41 0.0% Madrid $39 0.0% Manila $33 0.0% Seoul $30 0.0% Kuala Lumpur $23-0.8% 20 WHAT USD 100 MN COULD BUY? More than half a million sq.ft of prime office space in Bengaluru, the highest in the world Delhi emerged as the most expensive office market in India on the What USD 100 mn could buy? index followed by Mumbai Ranking City Sq.ft 1 Hong Kong 11,698 2 Tokyo 31,282 3 Paris 36,662 4 Zurich 43,754 5 London (City) 43,899

5 6 Singapore 48,389 7 New York 56,534 8 San Francisco 62,543 9 Dublin 65, Frankfurt 75, Sydney 76, Berlin 85, Amsterdam 96, Beijing 99, Madrid 105, Shanghai 115, Los Angeles 131, Boston 134, Washington DC 135, Melbourne 136, Seoul 140, Miami 156, New Delhi 156, Brisbane 157, Seattle 157, Mumbai 163, Austin 172, Chicago 204, Bangkok 229, Dallas 247, Manila 290, Pittsburgh 327, Kuala Lumpur 445, Bengaluru 512,385

6 EMPLOYMENT AND PROPERTY COST INDEX Bengaluru emerged as the most valued destination on the Employment and Property Cost Index with total cost (salary + property) of USD 1,264,000 Table: Cost to a firm (salary and property costs) of employing 100 people in a City (US$ per annum) Rank City Total cost (salary and property) 1 Zurich $7,947,260 2 New York $6,938,000 3 San Francisco $6,696,700 4 Hong Kong $5,964,990 5 Boston $5,936,820 6 London (West End) $5,605,660 7 Sydney $5,022,190 8 Tokyo $4,897,270 9 Chicago $4,874, London (City) $4,850, Singapore $4,616, Paris $4,115, Dublin $4,051, Stockholm $3,998, Frankfurt $3,814, Amsterdam $3,522, Warsaw $1,631, Cape Town $1,626, Bengaluru $1,264,000 HOW RISING INCOMES SPENDS WOULD INFLUENCE THE SHAPE AND CONTENT OF URBAN ENVIROMENTS Bengaluru and Mumbai top the chart among 10 future cities in terms of eating out spends Forecast in (%) in spending on eating out between 2017 and 2027 Bengaluru: 176.9% Singapore: 35.2% Mumbai: 136.7% Hong Kong: 33% Shanghai: 97% Austin: 26.4% Beijing: 96% Dubai: 22.1% Nairobi: 82.8% Sydney: 19.6% Source: Oxford Economics Knight Frank Global Cities: The 2018 Report

7 Bengaluru and Mumbai feature among the top 5 future cities in terms of households with significant incomes Forecast growth in households with an income of USD 35,000 USD70,000 between 2017 and 2027 Shanghai: 153% Dubai: 48% Bengaluru: 144% Austin: 18% Beijing: 133% Singapore: 16% Nairobi: 110% Hong Kong: 15% Mumbai: 67% Sydney: 7% Source: Oxford Economics Knight Frank Global Cities: The 2018 Report Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, The Global Cities: The 2018 Report offers a bird s-eye view into the future of the most state-of-the-art world cities. Our spaces are being redefined. And, one of the most disruptive facets of the change in spaces where we work, live and the overall urban ecosystem would be acquisition of talent. Organisations would have to thoughtfully handpick global cities, zoom into smart office locations within them and tastefully shape these spaces in sync with the fascinations of the crème-de-la-crème workforce making the world work today. And, it is needless to state that the evolution would be driven by technology and smart intelligence. According to Dr. Samantak Das, Chief Economist & National Director Research, Knight Frank India, Desires of the talent pool and rising disposable incomes are set to shape our urban environments in the near future. Global cities that are aspirational and successful in encapsulating an inherent wow factor are set to see the most dramatic transformation. We have already seen glimpses of the transformation with a shift in the expectations of mainstream occupiers. Today we see that the office space expectations of mainstream occupiers resembling those of niche sections such as the Start-up fraternity or the Googles of the world. The global trend holds true for select Indian cities such as Bengaluru and Mumbai. Viral Desai, National Director, Occupier Solutions Group, Knight Frank India, added, India s office market witnessed a stellar run in 2016 as compared to the recent past. It is also a fairly accepted fact that India is home to some of the most affordable Central Business Districts in the world. The findings of the Global Cities: The 2018 Report reinstates the fact. Bengaluru s Whitefield is a case in point. Despite the influence of global headwinds on mainstream occupiers, emerging trends such as Coworking space providers have continued to whip up demand in the supply-deprived market.

8 About Knight Frank Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank has more than 15,000 people operating from 413 offices across 60 countries. The Group advises clients ranging from individual owners and buyers to major developers, investors and corporate tenants. For further information about the Company, please visit In India, Knight Frank is headquartered in Mumbai and has more than 1,000 experts across Bangalore, Delhi, Pune, Hyderabad, Chennai, Kolkata and Ahmedabad. Backed by strong research and analytics, our experts offer a comprehensive range of real estate services across advisory, valuation and consulting, transactions (residential, commercial, retail, hospitality, land & capitals), facilities management and project management. For more information, visit For further information please contact: Aanchal Shetty (Knight Frank) Aanchal.Shetty@in.knightfrank.com Abhishek Sood (Blue Lotus PR) abhishek.sood@bluelotuspr.com