Average annual growth of occupancy costs from 2011 to 2015 forecast at 6.43%

The strongest increases in costs to 2015 are projected in Singapore, Bengaluru, Hong Kong, Beijing and Chennai.

According to DTZ, their forecasts show that the cost savings and incentives enjoyed by occupiers over the past few years are diminishing as we see a shift from a tenant to a landlord's market.

A cause for concern for occupiers is high inflation. We are already seeing the impact of inflationary pressure in India, where double-digit inflation has led to significant increases in outgoing in the past year.

This will also impact leases where rent is indexed to CPI. Whilst this is yet to play out on the global stage, it may begin to curb corporate expansion plans and facilities spending.

Global occupancy costs are set to rise in 2011, although the pace of growth will remain varied; with forecast growth in Asia Pacific more than double that of the other regions. DTZ anticipates a continuation of this trend through to 2015.

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