Global Office Supply

• North American market rents have averaged $77.03 psf in 2026, about 6% below economic rent, and are not expected to catch up until the early 2030s.
• Recovery will be uneven. Building already pays off in New York, where market rents are above the cost of new development. Boston and San Francisco are projected to reach that point in 2029, with Chicago and Toronto following later.

Asia Pacific

Regional averages hide wide variation in development feasibility. The average gap between market and economic rents in 2026 is small, but the markets behind it range from well above the level needed to justify new development to well below it, so the case for new supply depends heavily on the city.

• In 2026, market rents range from 19% below the level needed to justify new development in Sydney to 26% above it in Seoul, with Singapore near break-even.
• New development is projected to remain viable in Seoul and Bengaluru through 2035, while market rents in Singapore and Tokyo are expected to fall below the level needed to justify it from 2028 and 2030.
• A 2027–2028 completion wave will bring new supply to Singapore, Seoul and Bengaluru, while Sydney sees little until the 2030s. Beyond it, supply is expected to tighten across much of the region, so occupiers with lease events from 2028 should start searches early.

Europe

The economics of new development have fallen below global financial crisis levels as high building costs, rapid wage growth and rising interest rates collided. Starts have dropped sharply and rents have risen, setting up a gradual recovery that will arrive at different times in different cities.

• At the 2023 low, market rents were 18% below economic rents, the widest gap on record.
• Annual construction starts averaged 2.8 million square meters (sqm) from 2022 to 2025, 55% below the previous decade, while market rents have increased approximately 23% since 2022.
• Development is expected to become viable again across the region by the end of 2029. Paris recovers first, followed by London and Madrid around 2030, while Berlin and Amsterdam face longer paths, and planning and land constraints keep Milan’s development subdued.