Boom in building in the capital in advance of a shortage of office space in 2012-13
London office construction has shot up 137% in the past six months, according to the latest Drivers Jonas Deloitte crane survey.
25 new schemes have been started on site in the past half year as analysts predict a coming shortage of prime office space in the capital by 2012 – 13.
The research confirms that commercial office space in London is one of the few booming sectors in the country – and at odds with the commercial office market in many other UK cities, where there is a often a glut of space.
6.4m sq ft of space is under construction compared to 2.7m six months ago.
Anthony Duggan, head of research at Drivers Jonas Deloitte, said: “This survey records a dramatic positive change in construction activity as anticipated in our last report. The race is on to deliver schemes to take advantage of the dwindling supply of Grade A space in 2012 and 2013.”
Matthew Elliott, head of transactions at Drivers Jonas Deloitte, added: “The big story, perhaps the only story, is the building of the new City towers. If all are built we could see over 200 tower floors coming to the market at a similar time in 2014/15 - an unprecedented situation - and this excludes The Shard being built on the other side of the Thames.”
“Some will worry that this will lead to oversupply and falling rents, but others say that this is a further sign of confidence, a sign that London remains the global financial centre. Everyone is talking about it but the market doesn’t yet know how this will play out,” he said.