According to the figures in the last report of a property Advisor global leader, approximately 14 million square feet of office space in London is now extended unoccupied. This figure is at its highest since March 2007 and shows an increase in vacant positions of 36.5% for 12 months only. The commercial real estate market is directly linked the behaviour of the banking system. with banks as HBOS and the Royal Bank of Scotland is now controlled by the Government, the probability is still unused offices appear on the market as the Treasury Board implemented its plans to streamline the systems of these large financial institutions.
As banks seem to be setting the model for other businesses, the future owner view London office market is bleak: many companies dismissals and are either down-sizing on their premises, movement of capital or, in some extreme cases, declaring themselves insolvent and close up shop entirely. For owners of local offices in London, this spells more bad news, but for tenants search for Office space this is fantastic news. With offices in London on the market and less taken over up to empty and unused premises are simply go cost of money from the owner, in the current financial climate they can ill afford to lose. Sell their properties is an unlikely option and if they do, it is likely a considerable loss.
For tenants who are seeking to rent offices in London, the news is much better. What was once a market firmly controlled by the owners, is now market a tenant with fantastic opportunities in all areas. In an attempt to court tenants, owners are trying to ensure that their premises remains unused for as short a time as possible. This means that there has been a sharp decline rents. Commercial property News, London rental rates have already taken a reduction of 23% and figure looks set to rise as recession bites hard in the banking system and beyond. Coupled with low rents, owners also offer periods will move substantial. Only West end incentives have tripled in length for 12 months.
The current economic situation offers the possibility to move to the more favourable at a fraction of the costs that they would have faced London office space in 6-12 months ago tenants. With the decline in the strength of the pound sterling, London becomes more popular with enterprises international, as it is no longer retains the title of expensive capital most of the world, but continues to offer some of the best commercial links and services around the world. While these companies seek to exploit the slowdown and move around the top London office space range for reduced rates, it also leaves the door open for smaller businesses, terroir to benefit small and mid-scale market stagnation. As the credit crunch is spelling disaster for many institutions, potential tenants are a landscape of financial possibilities.
Shivani Gurtu-Louth - Devono property Limited operations manager. Devono are the only commercial real estate agents in London to exclusively represent tenants in London office space quest. We can also help you find serviced offices in London. Our goal is to ensure the best commercial property at the best price.
For interviews, quotes, pictures or comments contact:
Shivani Gurtu-Louth
Devono Operations Manager
Tel (DDI): + 44 (0) 20 7096 9911
Email: sg@devono.com
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