London is continuing to be the global city of choice for property investment, according to a panel of experts. Speaking to Jones Lang LaSalle, industry leaders explained that over the last 12 months the capital has outperformed other key players. However, they stress that there is no room for complacency.
Neil Prime, head of UK Office Agency at Jones Lang LaSalle, stated: "Even in the uncertain economic environment London remains the key destination for global capital flows and a place where occupiers can take advantage of the innovative and entrepreneurial environment that will drive their businesses forward."
The commercial market has performed well across the board, with secondary locations experiencing the largest improvement. This performance is expected to continue well into next year, presenting a lucrative investment opportunity. According to Jones Lang LaSalle, the leasing market is also performing well and is centred around "structural, consolidation, expansion and migration" demand. Pre-lets are also expected to return to the market over the next 12 to 18 months, as a result of constrained supply of speculative development.
Jonathan Evans, head of West End Agency and Central London Development, expanded: "The largest catalyst of demand in Central London remains structural, however some of this demand is regearing on a short term basis (3-5 years) and at the larger end, this will only add to pent-up demand and will become the target for preletting opportunities."
It is no surprise then that London has been named the most traded global real estate market for a fourth year running, with estimated central London turnover for 2012 standing at GNP 16 billion - a 35 per cent increase since 2011, when GBP 11.8 billion was transacted. Jones Lang LaSalle claim this growth is unlikely to stop anytime soon, as demographics and saving rates increase, attracting foreign investors. Not only does this have positive ramifications for the property market, but the city's economy at large, which has already proved itself more resilient than the rest of the country.
- Thursday 22 November 2012