“Londons office market remains resilient in the face of uncertainty as we witness an encouraging increase in new construction starts,” said Mike Cracknell, director at Deloitte Real Estate.
Some 55% of the office space under construction was already let and for larger schemes of over 100,000 square feet, more than three quarters was already committed to, Deloitte said.
“Notably occupiers in the financial services sector have pre-let 2.1 million square feet of space that is still under construction,” Cracknell said.
“This is a 50% increase in six months and suggests there is confidence the sector remains committed to London.”
The survey covers seven major central London office markets – The City, West End, Docklands, Kings Cross, Midtown, Paddington, Southbank – as well as three emerging submarkets – Vauxhall-Nine Elms-Battersea, White City and Stratford.
In Novembers survey, Deloitte had said demand would continue even with the impending exit of Britain from the European Union, with technology, media and telecom companies taking up most spaces in the city. [nL4N1XO5MY]
International Trade Secretary Liam Fox, a Brexit supporting senior minister, said the survey showed construction at its highest level since the 2016 Brexit referendum.
“This is a far cry from the doom and gloom predicted when the UK voted to leave the European Union in 2016 and reinforces the Citys global pre-eminence as an investment destination,” he said.
The citys massive financial services sector, however, remains downbeat about accessing EU markets after Brexit, City of London financial district chief Catherine McGuinness told Reuters last month. [nL8N21R5HV]
Nearly 300 financial firms in London have shifted about a trillion pounds in assets to new hubs in the EU to mitigate the uncertainty and avoid disruption to customer ties.
But Fox will tell an audience at the International Financial Services Forum later on Monday that he is convinced the City of London will “emerge fitter, stronger and more dynamic than ever” once the Brexit dust settles.
“We recognize your difficulties, we recognize your importance, and we want to work with you to give certainty and stability wherever possible as we move towards our new deep and special partnership with the European Union,” he will say, according to excerpts from his speech.
The construction of office buildings in central London is at its highest level since the EU referendum.
The upbeat findings in the Deloitte crane survey were seized on by the Department for International Trade as evidence that London was thriving despite Brexit. Liam Fox, international trade secretary, said: This is a far cry from the doom and gloom predicted when the UK voted to leave the European Union in 2016 and reinforces the Citys global pre-eminence as an investment destination.
It follows a recent report by the OECD showing that the total value of foreign investment stock into the UK increased by 5 per cent in 2018, Dr Fox said. He and John Glen, treasury minister, will address a City conference today. Both will talk…
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