Tech sector drives demand for London’s offices post-referendum
The tech sector is driving a return to health for the commercial property sector in central London.
According to Knight Frank, there was demand for 9.5m square feet (sq ft) of office space in central London between June and September. This is ahead of the long-term quarterly average of 7.5m sq ft.
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This demand is largely coming from the tech sector, Knight Frank said, with Spotify, Expedia and Deliveroo all looking for offices.
In the third quarter, Apple's pre-let of space in the Battersea Power Station boosted the commercial property sector. The tech giant will be moving to its new office space in 2021, relocating 1,400 employees.
James Roberts, chief economist at Knight Frank, said: "Over the past five years London has been reweighting its economy away from finance and towards technology and innovation, which will pay dividends as we move towards Brexit.
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"Given the big tech names currently looking for office space in London, and the huge deal last month from Apple, it is apparent that Brexit has had little more than a road-bump effect on the capital's burgeoning technology sector."
Investment in central London offices fell by a third year-on-year in the third quarter, however.
Stephen Clifton, head of central London at Knight Frank, said: "In the investment market we have seen more interest from high-net worth individuals than ever, particularly from Asia. This is partly due to currency but partly because they remain strong believers in London as a global capital city.
"Transaction volumes have declined but this is partly due to lack of available stock as owners are reluctant to sell while the Brexit uncertainty persists."