In Q4 2024, average net effective costs increased slightly, by 0.1%, continuing a moderate upward trend of 1.9% throughout 2024. London (West End), Hong Kong and New York (Midtown) continue to top the table of the 35 markets analysed by Savills.

According to Savills, several markets saw significant cost shifts in the final quarter of 2024, most notably Dubai and Los Angeles, which saw net effective cost growth for tenants of 7% and 5% respectively, supported by strong demand. EMEA saw some cost increases in the last quarter, with net effective costs to tenants rising by 0.7%.

In Portugal, the cities of Lisbon and Porto recorded notable growth in office occupancy, along with an increase in prime rental values, which stood at €29/m2/month in the capital and €21/m2/month in “Invicta”.

Frederico Leitão de Sousa, Head of Offices at Savills, highlights: “Portugal, particularly Lisbon and Porto, is on the radar of numerous international companies, benefiting from a dynamic occupational market with a robust take-up and extremely low vacancy rates, a reality that is more noticeable in Grade A buildings (60% of the 2025/2026 pipeline already pre-let), creating pressure on rents, which is reflected in the increase in prime rent in both cities. Furthermore, the return to office has already become a reality, following the trend in southern European countries.”

According to Savills, overall leasing activity increased by 18% in H2 compared to H1 2024. In its companion Market Makers report, which examines the top 10 prime office deals by size across the same 35 cities, the international real estate consultancy revealed that just over half (54%) of the deals analysed were new leases or expansions, reflecting positivity among prime tenants and the resilience of prime office space. Just over a third (33%) of the deals refer to spaces of the same size, while 13% reflected a reduction in area. Globally, the financial sector surpassed the technology sector in the second half of 2024 (figure 2), both in number of deals and area transacted.

Rick Schuham, CEO of Global Occupier Services at Savills, comments: “Ultra prime office space continues to represent a key strategic asset for many businesses globally and almost all sectors saw an increase in the amount of space transacted in the second half of 2024 compared to the first half of last year. In 2025, we expect continued growth in leasing and rental volumes, as the net effect cost growth we saw globally last year is expected to continue into the future.”