Fit-Out Costs for Indian cities are the Most Economical in Asia Pacific Region

• Cities in Japan and Australia continue to dominate the Top 5 on the list of most expensive office fit-out locations in Asia Pacific region with average costs being upwards of USD 150PSF
• All 7 cities from India feature in the bottom 10 out of the 30 with average fit out costs being sub USD 70PS
• Mumbai and Delhi are the most expensive fit-out locations in India

Today, Cushman & Wakefield launches their Asia Pacific Office Fit-out Cost Guide 2020-2021 in Asia Pacific region. According to the report, Mumbai and Delhi are the highest office fit out locations in India, but all the seven Indian cities make to the cheapest fit-out markets in Asia Pacific.

Cities in Japan and Australia continue to dominate the Top 10 list of most expensive office fit-out locations in Asia Pacific, according to Cushman & Wakefield’s 2020-2021 Asia Pacific Office Fit-out Cost Guide. Tokyo, Osaka, Nagoya and Sydney lead the rankings, with Melbourne climbing four spots to fifth this year.

Top cities in India with the highest office fit-out costs are

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

Source: Cushman & Wakefield

Asia Pacific is forecast to emerge from the downturn earlier than other regions across the globe and is well-positioned to return to strong economic growth by the end of 2020. While the region’s long-term fundamentals remain intact, the short but sharp recession will continue to echo and shape corporate decision-making into the future. Effectively, trends that may have taken many years to come to full fruition are being fast-tracked.

“As a result of the global pandemic, the increases in fit-out costs seen in recent years has reversed in most markets across the region. This trend is likely to persist as corporate occupiers continue to assess their capital expenditure budgets and corporate footprint requirements,” said Tom Gibson, Head of Project & Development Services, Asia Pacific. “We are also seeing greater integration of workplace strategy expertise into the early stages of the design and fit-out process. With working lifestyles and preferences evolving following the pandemic, companies are increasingly focused on aligning their space requirements with efficient workplace strategies and HR policies to better meet their corporate business and financial goals.”

From an office design perspective, the workplace will evolve from a regular office to a place for networking and with a social feel. We expect that while social distancing and a flexible work policy will reduce the number of seats in an office, there would also be a bigger focus on agile seating formats. However, conventional office formats in India are unlikely to change much expect bring in better HSSE features and create socially distant seating arrangements.” Commented Mr Shashi Bushan, Managing Director, Project & Development Services, Occupiers - India, Cushman & Wakefield.

Greater emphasis on health & safety and contingency planning, with new design trends focused on “touchless technology” and collaborative space

The focus on health and safety continues to intensify, bringing forward greater adoption of touchless technology, improved Heating, Ventilation, and Air Conditioning (HVAC) and smarter cleaning practices. Prolonged, enforced working from home has highlighted that productivity can be maintained, but at the cost of personal connection to colleagues and company culture. This raises questions around the optimal size and composition of the corporate footprint, while highlighting the need for ongoing investment into IT and audio-visual technology for collaborative team working. All these factors are important considerations as companies remain laser-focused on costs.

Mr. Gibson said, “The solution is to place a greater emphasis on strategic collaboration between corporate finance, human resources, corporate real estate, and workplace strategy. Companies are having to manage multiple levels of uncertainty and as a result, have a greater thirst for information. The role of the project manager remains pivotal to this solution by bringing meaningful data insights to clients, exposing them to best practices in the ‘new normal’ and assisting in making well-rounded decisions.”

“Most technology solutions investigated so far have centered around touchless technology. Institutional developers are investigating temperature screening as well as contactless ingress/egress and app-based elevator movement. The aim is swift movement of people with minimal touch-points.” said Mr Manish Goel, Managing Director, Project & Development Services, Investors, Cushman & Wakefield India.

Key points for India region

• Highest = Delhi = US$126 / sqft
• Lowest = Chennai = US$33 / sqft
• Mumbai remains the most expensive market in the India region (US$133/ sqft)
• Kolkata and Chennai are the new additions in the list

About Cushman & Wakefield’s Asia Pacific Office Fit-out Cost Guide:

Cushman & Wakefield’s Asia Pacific Office Fit-out Cost Guide is an essential tool to assist in corporate real estate decision-making regarding both fitting out and reinstating office space. The annual guide, which was first published in 2019, serves to assist occupiers in defining their capital planning and relocation budgets. It provides an overview of the office fit-out construction costs across 31 key gateway cities in the region, including a comprehensive fit-out cost section covering furniture, mechanical & electrical works, builder works, audio visual/IT and other miscellaneous costs. Download the Asia Pacific Office Fit-out Cost Guide 2020-2021 here.