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Knight Frank analyses cost of employing 100 staff

28 September 2017

 

Knight Frank, the independent global property consultancy, launches the fourth edition of Global Cities: The 2018 Report. The report looks into the continuous trends in real estate across 40 Global Cities, equipping occupiers and investors with insights for future real estate decisions. For the first time in this year’s edition is the comparison of 19 global cities on the total cost to a firm of employing 100 people in a city (US$ per annum), based on the cost of workspace and average salaries.

Highlights of the findings:

  • Hong Kong (US$5,964,990) emerged as the most expensive Asian city to employ 100 people – this is almost 30% lower than top-ranking Zurich.

  • The list is topped by Zurich where Knight Frank suggests the cost of employing 100 staff a year is US$7,947,260 as a result of high salary costs in the banking and asset management sectors.

  • Zurich is followed by New York and San Francisco, where a highly-skilled tech workforce drives up occupancy costs.

  • London (US$5,605,660), however, is one of the most expensive European cities in which to locate 100 staff.

  • Sydney comes at about 10% lower than London at US$5,022,190. The equivalent costs for other Asian cities including Tokyo and Singapore would be less than US$5 million per year.

  • Bengaluru (US$1,264,000), Cape Town (US$1,626,900) and Warsaw (US$1,631,670) offer a considerable discount to other global cities, reflecting a broader skills base and lower average salary.

Calvin Yeo, Executive Director and Head of Office Advisory, Knight Frank Singapore, comments, “Standing at 3rd in Asia in employment and occupancy costs bodes well for Singapore, as we compete as an Asian business hub.”

Nicholas Holt, Asia Pacific Head of Research, Knight Frank, says, “In an interconnected region, with corporates increasingly expanding their footprint across a number of markets, property and employment costs are two of the major cost considerations. The index shows Hong Kong as the top market in Asia-Pacific sitting in the fourth place globally, but still offering a significant discount when compared to Zurich and the US cities of San Francisco and New York. Bengaluru, which has become an important outsourcing destination for many MNCs offers the best value in terms of office and headcount costs not only in the region, but also globally.”

 

Global Occupancy Costs

Ranking

City

Global Occupancy Cost, per annum* (US$)

1

Zurich

$7,947,260

2

New York

$6,938,000

3

San Francisco

$6,696,700

4

Hong Kong

$5,964,990

5

Boston

$5,936,820

6

London (West End)

$5,605,660

7

Sydney

$5,022,190

8

Tokyo

$4,897,270

9

Chicago

$4,874,730

10

London (City)

$4,850,620

11

Singapore

$4,616,950

12

Paris

$4,115,120

13

Dublin

$4,051,670

14

Stockholm

$3,998,790

15

Frankfurt

$3,814,610

16

Amsterdam

$3,522,130

17

Warsaw

$1,631,670

18

Cape Town

$1,626,900

19

Bengaluru

$1,264,000

*Based on average salary cost, and current market office rents
Source
: Knight Frank, Newmark Knight Frank, Sumitomo Mitsui Trust Research Institute, Deutsche Bank (Mapping the world prices 2017)

 

END

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