The UK capital continues to be a magnet for international investors.
London's office markets set new records in 2014, with £20.9 billion ($31 billion) of investment deals undertaken across central London commercial markets – figures that eclipse the volumes achieved in 2006/07.
In the office sector, Asian buyers accounted for 33% of investors, with an average lot size of £156 million, reflecting demand from this group for large trophy assets. This is in contrast to an average lot size of £26 million among UK buyers, the next largest purchasing group (21%).
The London office investment market is especially international, with 65% of all investment deals coming from overseas.
Records were set in the leasing markets, too, with 8.2 million sq ft of space leased in the City of London. Rents for office space occupied by financial firms were flat in 2014, while those for ‘creative’ space increased by 8.3%.
The technology, media and telecommunications (TMT) sector was especially active, accounting for 32% of take-up in the West End alone, significantly ahead of the five-year average of 24%.
Reaffirming London’s status as one of the most global centres of the creative industry, media and entertainment companies have dominated this sub-sector, and account for 35% of TMT sector take-up. This was followed by tech companies, with 28% of TMT stock absorbed, much in East London.