Big name firms from the US are seeking new offices to lease in London. Experts predict that this Globalisation is set to continue.
Take up of offices to lease in London fell by 27% last year, however a doubling of demand from the technology sector suggests that the longer term outlook may fare better than earlier predictions, according to Knight Frank.
The commercial property firm found that 1.3 million square feet of office space was taken up by IT and telecoms companies in 2011, up from 640,000 square feet in 2010. Some of these firms included Facebook, Groupon, Nokia, Apple and Expedia. However, a slowdown in demand for offices to lease in London was recorded among other industry sectors, such as finance.
Knight Frank’s Silicon London report also highlighted that demand from technology firms covered areas like Covent Garden, Clerkenwell and Fitzrovia as well as the main tech site in the Shoreditch and Old Street roundabout postcode.
James Roberts, head of commercial research, said: “The central London office market felt the impact of the global economic slowdown last year. However, if the recent rally for equity markets continues, I believe we could see office demand pick-up again by the summer. Plus there is this additional upside from the technology sector to give us confidence. If office demand from tech firms doubles during an economic slowdown, it will be interesting to see what happens when growth improves.”
John Snow, head of central London offices, was also optimistic about the future of offices to lease in London: “That companies, like Apple, Google, and Facebook want to be in London over other European cities is a great vote of confidence in the capital. This is a time of huge change for London, with the foreign influence growing in both the leasing and investment market. London is a business friendly environment, which is the lure for overseas companies and investors. I expect this globalisation of London to continue.”