Cities in Japan and Australia are the most expensive office fit-out markets across the Asia Pacific, Hong Kong ranked 7th and Beijing 10th

The evolution of workplace designs gains momentum to cater to growing focus on employee engagement

HONG KONG, CHINA – Media OutReach – 4 November 2019 – Japan and Australia are the most expensive office fit-out
locations in the Asia Pacific, according to Cushman & Wakefield’s Asia
Pacific Office Fit-out Guide, which provides an indication of the office
fit-out construction costs across 28 key gateway cities in the region. The
guide, which serves to assist occupiers in defining their capital planning and
relocation budgets, includes a comprehensive fit-out cost section covering
furniture, mechanical & electrical works, builder works, AV/IT and other
miscellaneous costs and takes into consideration the reinstatement cost in Asia
Pacific.

The top ten cities in
Asia Pacific with the highest office fit-out costs are:

Source: Cushman & Wakefield

Tom Gibson, Managing Director, Project & Development Services, Asia
Pacific said, “Tokyo’s position as the most expensive office fit-out
market in Asia Pacific is a reflection of the unique construction requirement
in this market. The practice of working with building-appointed general
contractors and the pursuit of high-quality finishes contribute to the high
fit-out and reinstatement cost.”

“We anticipate
the gap between high and low office fit-out cost cities to narrow in the future
as Vietnam and India will be looking to further improve the quality of their
office space including having better technology, end-of-trip amenities and
higher quality furniture, fixtures and equipment. This will drive up the total
office fit out costs in these markets, which are already facing rising labor
and material costs.”

Source: Cushman & Wakefield

Across Greater China, Hong Kong is the most
expensive office fit-out market, with an average cost of US$130/sq ft, and
Taipei the least costly, with an average price of US$70/sq ft. In the Mainland,
the average fit-out cost in Beijing is higher than in Shanghai, Shenzhen and
Guangzhou.

Bryant
Cheung, Director & Head of Project & Development Services, Hong Kong
said, “Builders’ works is still the most expensive component in new office
fit-out projects, however, the AV/IT cost soars considerably given the rise of
remote working, virtual conferencing and co-working places.”

Multi-faceted
workplace designs to drive better employee experience and engagement

The change in design
and layout of work spaces has also become more prevalent today than ever
before. In recent years, companies have shifted their focus from just looking
at cost reduction and workplace efficiencies to factors that contribute to
enhanced employee experience and engagement. They are more willing to offer a
range of different facilities in their new offices to create an interactive
work environment, which then drive up the fit-out cost, but will help boost
productivity and allow them to win the war for talent.

The move to greater
adoption of co-working, flexible workplaces and provision of a variety of agile
workplace solutions has resulted in workplace design becoming more
multi-faceted. Today’s workspace needs to support various workstyles from
focused work to group collaboration and engagement and this means that
companies need to have a deeper understanding and wider exposure to the latest
workplace design strategies.

The ability to
provide a high quality of life at work has also become an important
consideration as companies build their competitive edge in today’s war for
talent. Comfort, safety, accessibility, tech-enabled surfaces and sustainable
materials will be even more pervasive in workplace designs across all markets.

A workplace
environment that is functional, tech-enabled and flexible with a variety of
work settings and amenities are the benchmark considerations today. The
tech-savvy generation expects a high level of technology adoption in the
workplace, which enables them to access information easily and quickly in a
conducive and comfortable environment. According to Cushman & Wakefield’s
Asia Pacific Office Fit-out Cost Guide for 2019/2020, the AV/IT and furniture
component is currently about 30% of the total fit-out costs.

The integration of
technology with furniture has a significant impact on total office fit-out
costs. Large AV set-ups, real time data on display with the latest tech
amenities at fast speeds mean higher costs related to high performance and
cooling facilities to maintain comfort levels. Sustainability factors such as
the type of materials used in the fit-out will also have a direct impact on
costs.

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global
real estate services firm that delivers exceptional value for real estate
occupiers and owners. Cushman & Wakefield is among the largest real estate
services firms with 51,000 employees in approximately 400 offices and 70
countries. Across Greater China, there are 22 offices servicing the local
market. The company won four of the top awards in the Euromoney Survey 2017
& 2018 in the categories of Overall, Agency Letting/Sales, Valuation and
Research in China. In 2018, the firm had revenue of $8.2 billion across core
services of property, facilities and project management, leasing, capital
markets, valuation and other services. To learn more, visit www.cushmanwakefield.com.hk or follow us on
LinkedIn (https://www.linkedin.com/company/cushman-&-wakefield-greater-china)