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)