LONDON (Bloomberg) — The cost of renting an office in London’s West End district climbed 17 percent in the past 12 months, cementing the area’s position as the world’s most expensive location for companies, a study by CB Richard Ellis Inc. showed.The total cost of renting a new or freshly refurbished office in the area cost an average of $212.03 a square foot in the third quarter, including taxes and other charges, the world’s largest real estate consultant said. The second-most expensive sites were in central Tokyo, where office space cost $145.68 a square foot.

London overtook Tokyo as the world’s most expensive place to lease an office in January 2001. Rents in the West End, home to the UK capital’s biggest concentration of theatres, restaurants and shops, have been driven higher by a lack of space for new developments.

“We’re expecting strong rental growth in the West End for the next 12 to 18 months,” said Nick Axford, head of European research at CB Richard Ellis, in an interview. “While the Tokyo office market is improving, the differential with London is pretty enormous.”

Vacancies in the West End stand at 3.7 percent, the survey showed. Rents for local offices won’t stop rising until the vacancy rate reaches 8 percent, according to Rob Noel, property director of Great Portland Estates Plc, a specialist central London developer.

Prime office rents in Mumbai rose 76 percent in rupee terms during the third quarter to the equivalent of $106.09 a square foot, making it the world’s seventh-most expensive location. In New Delhi, rental costs also doubled to the equivalent of $81.87. Rents in India have risen following a government crackdown on the unauthorised use of buildings for office purposes.

New York’s midtown Manhattan came 24th in the survey of 176 cities at $62.07 a square foot, while Moscow is Europe’s second- most expensive location at $109.30.

CB Richard Ellis has changed the times it conducts its twice-yearly surveys to May and November. Previously, it surveyed global office rents in January and August.