Expensive office space: Mumbai among top 5 on average age list
MUMBAI: A new JLL survey on the average age of the most expensive office space in 10 Asia Pacific cities ranks Mumbai at number four, with most buildings in the Bandra Kurla Complex (BKC).
Beijing and Shanghai have the newest office stock followed by Tokyo, Mumbai, Singapore, Delhi-NCR, Seoul, Sydney, Melbourne and Hong Kong.
The survey, which compares 30 buildings with the highest rents in each city, takes into account an equal number of buildings in Delhi’s central business district (CBD) and secondary business district (SBD), with the rest in Gurgaon.
The report said the recent construction boom in China helped Beijing and Shanghai have the newest office stock (stock-weighted average age of 8 years). Tokyo’s stock averages just 8.4 years, a result of recent and ongoing re-development projects, especially after the 2011 earthquake.
Singapore and India are both 11 years old while Seoul is older at 14 years. In Singapore, a fourth of the current grade-A space in the CBD has been built since 2010, mainly due to new supply in Marina Bay.
Australian offices are the second oldest in the region, averaging about 20 years old. However, the completion of International Towers Sydney in the Barangaroo precinct will lower average stock age in Sydney by three years.
“Hong Kong, at 21.6 years, is still at a ‘mellow’ age, going by Asia-Pacific’s regional standard. The reason behind its age is the very limited land supply in the core Central District and most new supply being in periphery CBDs and decentralised areas,” said the JLL report. The survey included the ICC in West Kowloon in addition to the top-30 buildings.
JLL India chairman & Country Head Anuj Puri said India’s relatively new and inexpensive office space should be attractive to corporate occupiers. “Moreover, investors should also look at India if they are looking to buy core/ life expectancy,” he said. A JLL study earlier this year had shown how the key Indian metros had attracted an investment of approximately Rs 170 billion in 2015. “It would not be surprising if this number is surpassed in 2016. Delhi-NCR and Mumbai had attracted the major chunk of this investment,” said Puri.
City Average Age of buildings
Beijing 7.9 years
Shanghai 8.1 years
Tokyo 8.4 years
Mumbai 11 years
Singapore 11.2 years
Delhi 11.5 years
Seoul 14.2 years
Sydney 20.3 years
Melbourne 20.5 years
Hong Kong 21.6 years