Tech firms have far outpaced the rest of the market for commercial property demand in London, taking the capital to the top of the list of Europe’s leading Tech Cities, according to new industry research.
Even not including the final quarter of the year, over two million square feet of commercial property in Central London was taken by tech firms in the first nine months of 2016 alone.
This was buoyed by major commercial property rental agreements, including some of London’s most recognisable landmarks – which are fast becoming highly desirable office addresses for the headquarters of tech-driven businesses.
One example of this is Battersea Power Station, one of the capital’s most celebrated landmarks, which was recently the subject of a 500,000 sq ft office leasing to a major technology brand after undergoing redevelopment.
London is among the leading cities on the planet for the creative and technology sectors, with a pivotal location, access to the UK’s envied legal and political systems, and plenty of cultural and lifestyle attractions for tech companies from all over the world, and the individuals who work for them.
All of this is not only good news for the market for commercial property in London, but also for employment prospects among highly talented and technically adept individuals in the city and its surrounding commuter towns.
Over the past five years, hiring in the tech sector has significantly outpaced other office-based employment in London, and the growth in iconic commercial property is giving those new recruits the premises they need in order to excel in their jobs.
Commercial property in the West End is close to capacity, leading tech companies to look for suitable commercial premises elsewhere in the centre of the capital.
Demand has risen in Southbank, Midtown and the City of London as a consequence of this, while Farringdon and King’s Cross have become firmly established as European centres of technology excellence.
Over the decade to 2015, the City of London saw a 6.3% rise in commercial property leasing demand, with a 5.9% rise in the EC4 postcode area of Central London too.
But it is on the fringe of the City where demand has spiked most significantly, rising 12.9% in Whitechapel over the same period, and 17.5% in Spitalfields.
All of this makes the capital one of the most exciting places in the world for tech and young tech talent – and as more areas reach saturation, the demand for commercial property leasing opportunities is only likely to spread further outward through London’s suburbs.
