"For the last two-and-a-half years … London has held top spot, reflecting the strength of its economy and high demand for space from a wide variety of occupiers, but the impact of currency falls post-EU referendum has made London very much more competitive on the world stage," Savills said in a report on Thursday.
Both New York and Hong Kong are currently more expensive to location to place staff, having risen slightly since December 2015. The cost for these two financial hubs stands at $114,009.57 and $100,984.26, respectively.
"Office-based businesses operating in major world cities will spend around one-third of their total operating costs on accommodation through a combination of commercial rents, paid directly to landlords, and demands on salaries created by the cost of employees' living accommodation. Fluctuations in these costs will therefore have a significant bearing on how competitive a city is to employers," Yolande Barnes, director at Savills World Research, said in the report.
After London, Tokyo was the next most expensive city, where costs in dollar terms have jumped by over a fifth this year. This reflects the close to 16 percent leap by the yen against the dollar since the start of 2016.
"The swings in world currencies since Britain's vote to leave the EU have helped to change an already dynamic range of market movements across cities to an extremely varied one. Tokyo saw the biggest increase in dollar terms as rent rises, particularly in prime residential and creative office sectors, where amplified by significant strengthening in the yen," Savills said.
The falling cost of renting in Dubai, Lagos (in Nigeria) and Moscow was due to the hit to occupier-demand in countries and companies closely affected by oil prices, Savills added.