Lebanon Businessnews News
 

Beirut: Expensive Offices
Cushman & Wakefield's survey for 2010 ranks Beirut as 4th expensive office space in MENA
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Manal Karam, who is head of corporate services at Cushman & Wakefield Beirut, said that the politico-security stability together with the limited supply of Grade “A” office spaces, “have together contributed in increasing demand and thus office prices in the capital.”

Globally, the findings which covered 202 key locations in 63 countries ranked Beirut as the 31st most expensive office location in 2010, up one position from 2008 findings. Karam said that “the minor supply in office spaces in 2010 is expected to exert additional pressure on office prices, thus inching them up further.”

While office demand dropped in most neighboring Arab States, Beirut has once again bucked the downward trend, faring better and preserving stable rates for office space costs and rents of net internal areas (or usable areas within a building) in 2009.

With a cost of $514 per square meter, Beirut’s office space was more expensive than that of Damascus, Riyadh, Cairo, Jeddah and Amman in 2009 but cheaper than that of Manama, Doha, Abu Dhabi, and the Dubai International Financial Centre (DIFC).

While rents of net internal office areas in Beirut remained unchanged at $466 per square meter in 2009, those of, those of Amman fell 20 percent, those of Abu Dhabi fell seven percent while those of Damascus and the Dubai International Financial Center (DIFC) dropped equally by six percent each.

“Compared to Amman, Manama, and Dubai where rents have been seriously affected by the financial recession, Beirut was able to preserve its market from rent falls,” said Karam.
 
The Beirut Central District (BCD) was the fifth most expensive office location among in the Arab region in 2009, said Cushman & WakeField.

But this is just the beginning for the BCD; several factors are seemingly prompting investors and business owners to favor offices located in Downtown Beirut and not in other locations.

“Some Physical building specifications including sustainability, seismic regulations, security and safety measures, and the availability of large floor plates are hard to find in Beirut neighborhoods except for the Central district which makes it a preferred location for multinational tenants,” Karam said.

Cushman & Wakefield is thus expecting office prices to keep an upward trend in the BCD on an impact of the high demand and low supply.

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Date Posted: Feb 24, 2010