Umazon Blog

Recession caused office complex development in and around London to stop. As a result, now when the market is picking up and companies want new offices, there are very few places that can be rented. This supply and demand scenario may actually push the rent very high very soon, benefiting those who took the risk of continuing with their offices to rent London projects even in bad times. Sensing this change investors are putting their money in Real estate investment trusts (Reits) as this can bring them back into the commercial property investment market with a boom.

The lack of office space is already visible in the Square Mile where there is hardly any space left for new offices. As there are very few property development projects in the area which will be completed by 2013, the rent is likely to go sky high.

Lack of space in the Square Mile often brings companies to take large offices in Canary Wharf. However, this time Canary Wharf is also not well equipped to supply their requirements due to very few office projects being in progress. The reason is very simple. Unlike other areas, Canary Wharf has only one main developer- the Canary Wharf Group. Three-fourth of the company is owned Songbird who trade on London’s Alternative Investment Market. Canary Wharf Group suffered badly during recession, accumulating debt of around £900 million as disclosed a few months back. It would have been a martyr to recession but the changing market scenario seems encouraging and will soon cause the company to recover as is believed.