Pictured above: Geoff Thomas

Birmingham's office market is more competitive as London's West End is once again the most expensive location in the world to occupy office space in, according to DTZ's latest Global Occupancy Costs survey.

Ranked fifth in last year's survey, London's West End has taken the number one spot, displacing Tokyo. 

In the UK, Edinburgh is in 44th, Birmingham in 45th and Manchester in 48th positions.

The report, a guide to total office occupancy costs across 116 business districts in 47 countries and territories, is DTZ's 13th annual survey and assesses the main components of occupancy costs in major office markets across the globe, ranking each location based on annual costs per workstation.

Birmingham costs fall, but rises up the table

Birmingham rose from 59th place in 2008 to 45th in 2009. Geoff Thomas, Birmingham based regional chairman, explained: "Whilst overall costs fell by three per cent in UK terms, from an international perspective there was a nine per cent rise due to the fall in sterling. Birmingham looks certain to remain a highly competitive British location, but European cities in particular are benefiting from the strength of the euro." 

Biggest fallers

The sharpest falls within the global ranking were recorded in those markets which have seen significant rental growth in recent years, most notably Singapore and Kyiv (Kiev), which both saw occupancy costs plummet by 51 per cent year-on-year (in local currency). 

Karine Woodford, head of Real Estate Strategy at DTZ, added: "In the current market, new occupiers will benefit from a wider and better pool of properties to choose from. As occupancy costs in prime locations become more affordable and space more available, a larger number of occupiers will be able to consider buildings in prime locations. Indeed, the silver lining for tenants actively looking for office space is that they may find rents quickly dropping to levels they cannot resist. With falling rents and more supply to choose from, the office market will offer tenants real value for money in the current climate, and we may see multi-national companies taking advantage of this shift and relocating their operations accordingly." 

Looking ahead to 2013 

DTZ Research has started forecasting occupancy costs for the first time to assist clients in their longer term planning. Reflecting global economic outlook, growth in occupancy costs is expected to be relatively muted over the 2010-13 forecast period, in contrast to the strong growth in occupancy costs experienced in recent years. 

Geoff Thomas said: "Between 2009 and 2013, the average growth of Birmingham costs is forecast at only 0.94 per cent, whilst the City of London is 6.69 per cent, Edinburgh 1.37 per cent and Manchester 1.02 per cent. In conjunction with the excellent availability of offices in Birmingham, this makes it a very attractive relocation option."