Lack of Available Commercial Spaces in London

02.12.10 |

The city of London will experience lack of commercial space and rise in office rentals by the end of the year reports Knight Frank. In a recent report Knight Frank offered unfavourable statistics with regards to the commercial state in London. It states that the city will not only witness a rise if property rentals it will also have a lack of available office space.

Knight Frank states that the price of commercial properties in the city will see a 43% spike. At the same time rentals will increase by 19%; this is due to lack of available commercial spaces.

The rental of a commercial property in Square Mile is from £44 per sq ft. however it is expected to increase to £55.20 per sq. ft by the end of the year. Many new projects may take a back seat due to this rental increase.

The current rental in offices to rent London is £65 per sq ft; it will increase to £73 by the end of 2010. As the demand will exceed the supply financial firms and hedge funds offices will grow.

As the commercial rents increase the city it will also see a lack of commercial space to conduct business. This means that new ventures will take a back seat. London will have experience 14% dip in office spaces while at the same time it will see a 26% dip in office schemes.

Ronny Nathan reported that the city has not seen such a trying time since 2007. The constant rise and fall in the market has left investors unable to secure their investments. Mr. Nathan, the Chairman of Capital and Overseas Holdings that this is indeed a bad time to invest.