Fit-out cost inflation begins to feed into occupier costs, rising 6% in 12 months

Savills analysis of Q2 2022 Prime Office Costs (SPOC) in global markets around the world shows that inflation and supply chain issues are now feeding into office fit-out costs and keeping occupiers’ net effective costs high in many cities around the world.

Over the past year, fit-out costs have risen an average of 6 percent across the SPOC cities that have so far reported rises, says Savills, although proportionally they remain a small part of overall costs compared to rents. However, several markets are also seeing rising rents, especially for ESG-compliant spaces, as occupier demand continues to support the prime end of the market. Savills highlights that this is especially prevalent in Paris, where competition for space has driven up face rents at the same time as fit-out costs have increased, with net effective