Global office costs have risen 3.4% year-on-year in Q2 2025, according to the latest report by Savills. As companies increasingly prioritize premium office space, demand continues to push up rental rates across major international business hubs.
The research reveals that London’s West End retained its title as the most expensive office market in the world. Businesses in the district now pay an average annual cost of $312.13 per square foot, a figure that underscores the sustained appetite for well-located, high-quality workspace. Hong Kong ranked second globally, with average costs of $225.28 per square foot.
Savills notes that the recovery in global office leasing is not just about return-to-office mandates. Many firms are actively using high-end office environments to attract talent, reinforce brand identity, and support hybrid working models. As a result, prime office locations are seeing stronger price resilience than secondary or tertiary spaces.
This 3.4% increase in global office costs reflects a broader shift in corporate real estate strategies. Rather than downsizing aggressively, many occupiers are relocating to better buildings in more desirable areas, especially in cities with a strong service economy and infrastructure.
However, the gap between top-tier and lower-tier office spaces is widening. Older or less adaptable office stock continues to underperform as sustainability, wellness, and design become key drivers of leasing decisions. Landlords of lower-grade space may face increasing pressure to upgrade or reposition assets to remain competitive.
Savills’ report further highlights regional trends, including growing costs in New York, Tokyo, and Paris. Although markets vary by macroeconomic and local demand factors, the global trend remains clear: quality office space is commanding a premium, and businesses are willing to pay for it.
With workplace standards evolving and competition for talent still intense, the demand for premium office locations is likely to remain strong into 2026.
