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. Last Updated: 07/27/2016

Moscow Office Cost Among Priciest

Moscow has become one of the top four most expensive locations to rent offices in the world, real estate services company CB Richard Ellis said in a report released Wednesday.

With average annual rental rates of around $215 per square meter, Moscow leapt two places in the recent survey to break into the top five for the first time.

London's West End topped the poll, with average annual rental rates of over $390 per square meter. Mumbai came second and the City of London third.

The poll places Moscow ahead of other leading major financial centers, including Tokyo, which came in fifth in the survey, and midtown Manhattan in New York, which came in 12th.

Over the last year, Moscow was the city with the second fastest-growing rental prices, the report also said. The survey said office rates in Moscow rose by around 65 percent. Only Singapore outstripped Moscow for rate of rental growth with an 85 percent increase.

Moscow's rental prices have led analysts to suggest that a bubble could be forming in the city's office sector. But with vacancy rates scudding along below 4 percent, commentators have said demand is set to outstrip supply for years.

Over the next few years, several major office developments are set to come online. The Moskva-City development should eventually add office space approximately four times that of London's Canary Wharf to the market.

Whilst office prices are soaring, a report released by Cushman and Wakefield suggested that Moscow's retail rents could be easing comparatively. In the report, which rates the world's most expensive shopping locations according to rental costs, Tverskaya Ulitsa slipped from 15th place last year to 18th place this year. Annual rental rates for Tverskaya averaged around $280 per square meter this year.