November 1, 2016
Contrary to the rather less positive outlook predicted for the whole of Scotland, office occupier take up in Edinburgh is on course to defy gloomy Brexit predictions, following a steady third quarter of 2016, according to new statistics published by JLL. In total, 134,462 sq ft of office space, spanning 44 deals, was transacted in Edinburgh between July and September, only marginally down on the previous quarter. Reflecting the rapid growth of Edinburgh’s booming TMT sector, tech companies have accounted for 30 percent of all Edinburgh office take up so far this year, followed by Professional Services at 21 percent. Total take-up for the year to date (Jan – Sept) reached 570,000 sq ft, just 5 per cent behind the transacted space recorded at the same point in 2015, a year which saw the capital’s highest take up since 2001. Responding to the rise of Edinburgh’s tech sector landlords are carrying out refurbishments aimed at appealing to this upcoming market, including Edinburgh’s largest single office building at One Lochrin Square and Greenside, a refurbishment proposed by the Chris Stewart Group.
October 25, 2016
The recent warning that the major banks are planning to leave the Capital following the Brexit vote has understandably caused some concern within the commercial property sector; so it’s cheering to hear that three in ten (30 percent) institutional investors actually believe Brexit will either increase or significantly increase European commercial real estate investment opportunities. A further one in four (23 percent) institutional investors believe that Brexit will have no impact on commercial real estate investment opportunities. According to a new study by BrickVest, following the UK’s decision to leave the European Union, nearly two in five (38 percent) institutional real estate investors cited London as the top European city to invest in commercial real estate, ahead of Berlin (36 percent), Munich (31 percent) and Paris (22 percent). However, one in five (21 percent) cited both Dublin and Hamburg and a further 16 percent selected Frankfurt, highlighting a clear positive trend towards German commercial real estate. Indeed 40 percent of the top ten European cities were German.
October 18, 2016
Although the UK economy has shown a measure of resilience post referendum, take-up in the key London office market, although still on a quarter to quarter rise of 34 percent, is 7 percent below its long term average. According to the latest London Office Snapshot from Colliers, transactions were largely boosted by major deals to Apple (500,000 sq ft) and Wells Fargo (220,000 sq ft), with both deals for new headquarters buildings, in Battersea and the City core respectively, being a major vote of confidence for London. In the City, the level of take-up demonstrated some positivity as it rose by 8 per cent quarter on quarter, though the quarterly take up is still 26 percent below average. Though pre-letting activity was healthy, doubling quarter on quarter, West End take-up was disappointingly subdued in the third quarter, falling further from the already sharply below trend Q2 total. Encouragingly, a number of deals that were seemingly ‘mothballed’ post referendum have now been concluded, albeit at marginally lower price points.
October 13, 2016
Think Tank New London Architecture (NLA) which creates a forum for debate on the built environment, has launched its findings and recommendations from its landmark WRK / LDN Insight study on work and workplaces in London. NLA calls on central government, the Mayor of London and other stakeholders in the capital to act to maintain the capital’s position as a preeminent commercial centre. The report claims that, as the digital economy continues to expand, new suppliers of workspace are rapidly emerging – from co-working providers to ‘fab labs’, makerspaces, incubators and innovation centres. The insight study concludes that the affordable business space that currently supports these industries is at risk. London needs new innovative mixed-use models of city planning to support these changes and adapt to the changing world of work.
September 29, 2016
The level of transparency in the reporting of the environmental performance of commercial real estate is growing across the world, but the pace of new sustainable building regulations remains slow. That is the key finding of JLL’s Real Estate Environmental Sustainability Index, which measures the availability of a range of environmental transparency tools in 37 countries. Whilst 17 countries have improved their overall scores since the last survey two years ago, 13 have remained static and three have declined. Half of all country index improvements have been driven by the introduction of voluntary minimum energy efficiency standards for existing buildings. This year France topped the Index for the first time, thanks to the consistent roll-out of mandates to transition to a low carbon economy. Japan has moved up from the transparent group to join France, Australia and the UK in the highly transparent group.
September 28, 2016
Apple has confirmed the rumours that began in the Spring of this year by announcing that it is to relocate its UK headquarters from its current base in the West End along with several other sites to the redeveloped Battersea Power Station. The site’s developers say that Apple will become the largest office tenant at the £9 billion Battersea Power Station mixed use development occupying approximately 500,000 sq. ft. across 6 floors of the central Boiler House inside the iconic building. Apple is expected to move into the Power Station in 2021 at which time the office will account for circa 40 percent of the total office space in the whole development. 1400 Apple employees from existing offices around London will relocate to one of London’s best known landmarks. Apple has added, that this is a great opportunity to have its entire team working and collaborating in one location while supporting the renovation of a neighbourhood rich with history.
September 28, 2016
The UK’s commercial property market remains robust in the wake of the vote to leave the European Union, although a weaker economic outlook may see some prices dip over the next two years, ratings agency Moody’s claims in a new report. The news comes as commercial property fund Standard Life announced that it has reopened trading, which was suspended in the immediate aftermath of the Brexit vote. Moody’s said that the June 23 vote still has the potential to create significant uncertainty in the longer term, but that the fundamentals underpinning the UK commercial property market remain sound. Much will depend on the country’s broader economic prospects, Moody’s claims. If unemployment remains low and jobs growth continues, these two factors will do much to maintain demand for both domestic and commercial property although London’s market may be affected even if the national economy is robust, as firms may choose to relocate anyway.
September 27, 2016
The UK’s major cities are lagging behind their European competitors in terms of skills, innovation and productivity, claims a new report from the Centre for Cities think tank. In Competing with the Continent, the authors argue that the onus is on the UK to come up to speed with the 330 cities covered in the report, especially if they want to compete in the new post Brexit European landscape. However, the report notes that the UK has a number of existing, structural advantages over other countries. UK cities generate around a fifth of Europe’s total economic output and contribute more to the national economy than cities in other countries. Major British cities contribute 60 percent of national GDP, compared to just 36 percent in Germany and 32 percent in Italy. The report shows that UK cities lag behind on a range of indicators including skills, innovation and productivity and a number have an industrial mix that has more in common with cities in Eastern Europe than those in the West.
September 19, 2016
Start-up tech firms in London face the world’s highest property costs and the result is a boom in coworking, according to a report from Knight Frank. The research, undertaken as part of Knight Frank’s 2017 Global Cities Report, examines the cost of leasing and fitting-out 600 sq ft of office space in the tech and creative districts of the world’s leading cities. Intense demand for space in Shoreditch, London, has seen start-up office costs soar with Knight Frank calculating 600 sq ft of office space to cost US$66,706 per year – the highest of any creative district in the world. This is followed by Brooklyn in New York (US$62,736), Mid-Market in San Francisco (US$61,680), 1st, 2nd and 9th Districts in Paris (US$57,426) and the Seaport District in Boston (US$50,700). However, London’s burgeoning coworking market also shows how firms are using the model to overcome the challenge of finding somewhere to work at an appropriate cost.
September 14, 2016
A much publicised but occasionally troubled green city in the United Arab Emirates without light switches or water taps has much to teach people around the world about saving energy and precious resources, claims a new study from researchers at Birmingham University. With its low-rise and energy efficient buildings, smart metering, excellent public transport and extensive use of renewable energy, the 2,000 citizens of Masdar City in Abu Dhabi, are living in a place which is a ‘green’ example to city planners around the globe, claims the report. There are no light switches or water taps in Masdar City. Movement sensors control lighting and water in order to cut electricity and water consumption by 51 percent and 55 percent respectively. Masdar is a mixed use development that is the world’s first city designed to be ‘zero carbon’ and ‘zero waste’. Masdar City is a large-scale mixed use development which lies 17 kilometres south-east of the city of Abu Dhabi.
September 14, 2016
London’s property sector has been resilient following the EU referendum, with commercial property rents remaining strong over the summer, though over the next few months the overall direction of the market is likely to become clearer. This is according to the latest CBI/CBRE London Business Survey, which has found that businesses want the city’s mayor to play a leading role in influencing Brexit negotiations, particularly in driving improvements to the city’s transport infrastructure. Two thirds (67 percent) wish to see upgrades to the existing London Underground network, whilst over a half (55 percent) want a commitment from City Hall to start building Crossrail 2 and one third (31 percent) hope for greater investment in the capital’s road network. Unsurprisingly, uncertainty over the UK’s role in the EU is the most significant cause for concern (75 percent of firms), followed by retaining the best people for the job (49 percent) and a lack of appropriately skilled staff (44 percent).
September 13, 2016
The future of London is the subject of a new and wide ranging collection of essays from Think Tank Localis. It includes contributions from the likes of Boris Johnson, Terry Farrell, Peter Bazalgette and Justine Roberts. Its core theme is that while London has established itself as one of the world’s great financial and cultural powerhouses over the last thirty years, it now faces a number of new challenges and intransigent problems that it must address in a new globalised era. These have taken on a new perspective as the UK prepares to negotiate a new relationship with the EU, something which the report repeats was not the choice of Londoners, but which did perhaps reveal a neglect of the rest of the UK as the Government focused too much attention and investment on the capital. So, while the report focuses on London it also tries to create a vision of a London better integrated with the needs of the rest of the UK and based on a new partnership with the EU.