Global prime office rents fell by an average of 4.25 per cent in 2008, says a study by Knight Frank's Global Real Estate Markets Review and Outlook 2009.
India is also facing the heat of global downturn, and the rents in Mumbai and New Delhi have fallen by nearly 10-25 per cent.
The study, which covered major office markets across the Americas, Europe, the Middle East, Africa and the Asia Pacific region, revealed that office rents in more than half the 102 cities have witnessed declines.
Knight Frank noted the strongest declines were in Europe, where rents fell by 12 per cent on average and two-thirds of the continent's major office markets experienced negative growth. Several European markets have continued to see falling rents in the first quarter of 2009, including London and Moscow, which recorded two of the largest falls in 2008.
Joe Simpson, head of international research, Knight Frank, commented: "Despite a number of European markets observing rental falls in 2008, values should stabilise in the latter half of this year.
"Markets that weathered the effects of the downturn in 2008 included the primary German cities and regional UK markets, including Glasgow, Edinburgh, Leeds, Sheffield and Bristol. However, the substantial depreciation of the British pound against both the US dollar and the euro now means rents have fallen substantially.
"Positively, the supply of new office space in the development pipeline is at a more modest level than has been the case in previous downturns, although there are exceptions."
