London has become the world's most expensive destination to rent office space, regaining the title from Hong Kong for the first time since 2008, according to a research report.
Global real estate services firm Cushman & Wakefield said that London's West End is the world's most expensive office market at present, and is costlier than Hong Kong's central business district (CBD).
The firm noted that London has experienced shrinkage in the supply of quality office space, inflating office rents by 2 percent in the West End.
It now costs an average of £170 ($262, €195) per square foot of office space, including rent, service charges and property taxes.
This is 43 per cent more expensive than Hong Kong, which was hampered last year by a slowdown in global banking. Office space there costs an average of £119 ($183, €136) per square foot.
Brazil's Rio de Janeiro comes third with an average price of £107 ($165, €123) in its Zona Sul (South Zone) area. Brazil is preparing to host the 2014 World Cup and the 2016 Summer Olympics in Rio.
New Delhi came in at the fourth place, while Tokyo claimed the fifth position. New York is eighth, charging £84 in Midtown Manhattan.
"As a truly global city, London's appeal continues unabated. In conjunction with a scarcity of good quality stock, prime rents have increased over the year," Digby Flower, Cushman & Wakefield's head of London Markets, said in a statement.
The property agent also expects office rents to go up further in the city.
"Safe havens or gateway cities such as London, Hong Kong and New York continue to command high rents despite uncertain economic conditions, as they remain key markets in which to do business," said Glenn Rufrano, President and CEO of Cushman & Wakefield.