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Take Advantage of the Credit Crunch by Investing in & Renting London Commercial Property
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by: Shivani Gurtu-Louth
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Word Count: 510
Economic downturns and recession are a cyclical part of the world’s economic structure. The ramifications for a country can manifest themselves in many different ways but, as a rule of thumb, for many it means that the cost of living is more expensive, as fuel bills rocket and property prices plummet. However, during these times, opportunities for business owners often arise from the most unexpected sources.
Research into the potential effects of the UK’s predicted recession on the market for office space in London, has provided information that might be considered good news for those looking for new premises in the capital.
According to a study on London commercial rents, prime City office rents are down by £7.50 per square foot to £57.50 when compared with the same period in 2007 and the capital value of commercial office space in London is down by 30%. While this is bleak news for landlords, it provides welcome opportunities for those looking to rent office space and those looking to buy.
In the wake of the credit crunch, there is also the situation where the supply of office space and commercial property in London is now outweighing demand. Prudent prospective tenants and buyers are now finding themselves in an extremely advantageous position and can use their commercial property agents to negotiate favourable terms on their behalf. Landlords and vendors are now more likely than ever to cut their rentals and vendors are anticipating selling commercial office space in London at much less than its previous worth. Needless to say, the current economic landscape is attracting many long-term investors who have been watching the property markets and are now ready to reap the benefits.
In addition, there are still many office developments under construction, but the waiting lists for tenants have evaporated over recent months. For the immediate future, this suggests that dramatically more office space will leak into the market and continue to force rental and investment prices down. Another study has predicted rising vacancy rates across the capital for the next year and a half. As the situation stands, the market for office space in London is definitely now in finding favour of those looking to rent and to buy.
Whilst buyers can expect to snap up office space in London for much less than its previous market value, tenants can look forward to a series of incentives to accompany low rentals, such as ‘grace’ periods. Landlords and vendors alike seem to be prepared to accept what they can get in this current climate, rather than watch their office space in London go unused and lose money on upkeep and business rates.
Whilst the credit crunch has directly affected banks and financial institutions and resulted in large numbers of redundancies in those sectors, businesses and companies that are continuing to expand should be looking carefully at the commercial property market. If an expanding company has the capital, it seems that there has never been a better time to invest in office space in London.
About the Author
Shivani Gurtu-Louth - Operations Manager of Devono Property Limited. Devono are the only
commercial estate agents in London to exclusively represent tenants looking for office space and commercial property in London. We can also help you find serviced offices in London. Our aim is to secure the best commercial property at the best price.
For interviews, quotes, images or comments contact:
Shivani Gurtu-Louth
Devono Operations Manager
Tel(DDI): +44 (0)20 7096 9911
E-mail: sg@devono.com
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