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Cushman & Wakefield Forecast reaffirms efficiency and quality driving global office rents

Cushman & Wakefield, the world’s largest privately-held commercial real estate services firm, today issued its latest Global Office Forecast report highlighting the continuing trends of efficiency and quality as key drivers of demand and asking rents.

Download the global report here:


The global office market is poised for slow steady growth in 2014, while 2015 should be more robust as recovery takes hold and business gains renewed confidence. Jakarta, Dublin and Boston are the regional leaders among the top cities forecasted to see the highest office rental rate growth through 2015.




“Reduced occupancy footprints and an upgrade to better quality space are two global trends that are here to stay.” said Carlo Barel di Sant’Albano, Executive Chairman of Cushman & Wakefield. “The workplace is becoming more complex and inter-related with business performance and objectives, with modern efficient space seen as promoting increased productivity and workplace satisfaction. In certain instances, new construction can achieve both goals.”


Technology and energy continue to be the main drivers of the U.S. real estate recovery. As a result, Boston is expected to see continued strong demand pushing prime asking rents upwards by 22% through the forecast period, while Dallas is enjoying a resurgence of activity with rents expected to rise approximately 3% annually. Softening near-term demand will result in an oversupply situation in Canada, Mexico and Brazil. Rents will decline modestly in Canada and Mexico while widespread rental growth in Brazil will not take place until 2016.

"Office market conditions will vary widely across the Americas in 2014, as economic recovery favors some sectors, along with the markets in which they are located,” said Maria Sicola, Executive Managing Director and head of Americas Research. “Steady leasing activity related to the adoption of efficient new workplace strategies that include consolidation and densification will continue."

Markets whose tenancy foundations are built on a more traditional mix of sectors, which continue to shrink their occupancy footprints, will continue to move along a slow growth trajectory. Not surprisingly, Washington, D.C. is not expected to see a return to recovery until 2015 due to economic difficulties exacerbated by a polarized Congress.


Major international cities such as London, Stockholm and Frankfurt have led in the European leasing recovery, but others are now joining in, including some from the formerly distressed fringe. Dublin, for example, has bounced strongly with no new construction underway and double-digit rental growth anticipated.

“Occupiers have a clear preference for quality space but many are encountering supply constraints in an increasing number of cities,” said David Hutchings, Partner and Head of Cushman & Wakefield’s European Research Group. “This is pushing rental growth and occupiers will have to move sooner than expected to secure deals on the decreasing amount of quality space that is available.”

This will push rental cost up quite sharply in the most under supplied markets but rental trends will be highly variable through the forecast period with many markets flat and weaker locations having to cut rents further to remain competitive.


More subdued growth in the region should cause leasing conditions to remain less buoyant over the next year with rents expected to advance by 1-2%. Rental growth rates will pick up in a number of core and emerging locations led by Tokyo and Manila, where supply risks are limited, upon the resumption of stronger economic growth.

“With the abundance of new supply especially in the emerging markets, it remains a great time to be an occupier,” said Sigrid Zialcita, Managing Director of Research for Asia Pacific. “However, Jakarta is among the exceptions with rents on track to rise nearly 30%, the highest forecast globally for the second consecutive year with rates more than double the level in 2011 when the report was first released.”

Considering the prevalence of high rents and continued increases, many tenants are taking a long, hard look at devising ways to achieve efficiencies. Many businesses are seeking space in lower-cost options outside of the central business districts and in the process upgrading to new construction.

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Cushman & Wakefield is the world’s largest privately‐held commercial real estate services firm. The company advises and represents clients on all aspects of property occupancy and investment, and has established a preeminent position in the world’s major markets, as evidenced by its frequent involvement in many of the most significant property leases, sales and management assignments. Founded in 1917, it has approximately 250 offices in 60 countries, employing more than 16,000 professionals. It offers a complete range of services for all property types, including leasing, sales and acquisitions, equity, debt and structured finance, corporate finance and investment banking, corporate services, property management, facilities management, project management, consulting and appraisal. The firm has nearly $4 billion in assets under management globally. A recognized leader in local and global real estate research, the firm publishes its market information and studies online at


Peter Gallagher


Ola Jacobsson

Ola Jacobsson


Stockholm, Sweden

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