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Focus on Business in the City of London

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Focus on Business in the City of London from LondonOfficeSpace.comWithin the square mile that makes up the City of London, there are more than 14,000 businesses. Fortunately the city’s landscape reaches high, otherwise there wouldn’t be much more room for budding entrepreneurs.

Known worldwide for being a hub of financial activity, the City of London is home to some of the world’s biggest accountancy firms, banks, and investors. Amongst the financial moguls you’ll find the occasional law firm, tech ventures like Google, and telecommunications outfits like Three. Competition for rental space is fierce, and the City of London’s local government does expect businesses to commit to sustainable practice. Knowing a little more about this area in general can help you determine whether it’s the right place to invest.

The City of London’s Financial Sector

The City of London is also known as the “Square mile”, and when investors worldwide hear that phrase, they know people are referring to the UK’s financial hub. There, you will find traditional banks and insurance agencies, including international branches like the Bank of America and the Bank of Canada. Foreign exchange businesses also thrive in the City of London, with a turnover of around 0.73 trillion alone.

Sitting at the heart of all this financial activity is the London Stock Exchange, which has been in existence since 1801. Alongside the heavily regulated London Stock Exchange is the alternative investment market, which exists for those who do not have the usual connections for traditional investing. It’s less well regulated, but it does open the financial floor up to a broader range of investors.

Although the finance industry dominates the City of London’s business activities, you will find the odd non-financial venture. This includes Google, which is home to one of London’s most innovative offices with hundreds of employees. Finally, there’s Three, which is a relative newcomer to the telecommunications industry, but is one that continues to grow stronger on a daily basis. Continue reading “Focus on Business in the City of London” →

Commercial Property Value in the UK Weakened in February

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The performance of commercial property in the UK weakened this February according to CBRE’s latest Monthly Index. Total returns for commercial property in the UK fell to 0.1% and capital values fell by 0.4%. The downturn in commercial property performance came in spite of the fact that Central London offices have seen an improvement, with returns up from January, from 0.3% up to 0.5%. The weakening of property valuations covered the three main commercial property market sectors, shopping centres, shops and offices located outside of the Central London area.

On a more positive note, Central London offices have seen renewed growth, which is responsible for offsetting the decline of most parts of the commercial property market. Central London office property values saw an increase of 0.1% for the month.

According to the CBRE’s February 2012 UK Monthly Index survey total returns on all property were 0.1% for the month, with capital values down 0.4%. The retail property market suffered the most in February, providing a return of -0.1%, while industrial property returned 0.4% and offices returned 0.2% overall. Office property values for the rest of the country fell to 0.9% in February.

Rental values showed an improvement over the previous month while retail centres, shops and shopping centres suffered weaker returns, at -0.3%.The report went on to say that a third of commercial property investors have said that London is the most attractive property investment in the EU, ahead of Warsaw by more than 20%.

According to the CBRE’s Senior Analyst, Nick Parker, foreign investors are continuing to target and focus on the UK, and London in particular. Mr Parker said “this was because foreign investors are less constrained by a tight domestic debt market.” He also stated ‘Combine this finding with a healthy skew of respondents who said they intend to increase their overall purchasing activity in 2012 compared to last year, and the picture for the commercial property markets in London and the UK looks quite positive.”

References: Property Magazine and CBRE

London Fashion Week — A lot of Fuss or Serious Business?

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Although some may see London Fashion Week as a vacuous show of vanity it should also be remembered that the fashion industry in London contributes an enormous twenty one billion pounds to the UK economy annually.

Now in its 28th Year, London Fashion Week is a six day event which brings in buyers from across the globe who are expected to place orders topping one million pounds. London Fashion week is also a chance for UK designers to showcase this seasons fashion lines, and can make or break a fashion label.

In addition, the fashion industry in the UK is the creative industry’s largest employer, providing 1.3 million jobs, which accounts for approximately 4.5% of the UK’s workforce.

3 Million Sq Ft of Office Space Lost in London’s West End

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According to a report nearly 3 million square feet of London’s West End office space was converted into homes or apartments between 2001 and 2009. The report goes on to say that due to the conversion of West End office space into residential homes, competition by companies looking for new premium office space in the area has increased.

The study, undertaken by H2SO, found that a total over four million square feet of West End office space was converted into homes, leisure facilities, restaurants and other alternative uses. In addition the study showed that the drive to convert office space into residences was largely fuelled by high property values, with homes worth twice that of office buildings in key areas such as St James and Mayfair.

Due to the decline of office space in the heart of the West End a large number of new office buildings and business centres are being developed within the Kings Cross, Paddington and Euston areas, which is good news for companies looking for Grade A office accommodation.

A Third of SME’s in London Trade Solely Online

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According to a recent survey one out of three small businesses in London are selling their products exclusively online.

Research undertaken by PeoplePerHour showed than thirty four percent of small businesses in London operate without a bricks-and-mortar presence on the High Street, and only trade via the internet. The survey showed that even the sixty one percent of small businesses who do have a physical store front presence still make half of their sales on the web.

Forty seven percent of SME’s currently do the majority of their business online, while the number of companies selling more than fifty percent of their services or products via the web has increased twenty seven percent.

The number of firms which sell more than half of their products or services online has increased by 27 per cent, with 47 per cent of SMEs now doing the majority of their business on the web. Many small businesses are attracted to online sales due to cost-effectiveness and the reach their online presence can provide.

London Sees Increase in Office Space Occupancy

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Businesses are being advised to secure new offices as soon as possible to take advantage of current rental deals on offer. According to DTZ, office occupancy costs have fallen at some of the UK’s corporate business centres, in part due to the recession and the eurozone crisis. However, London is still one of the five most expensive places to rent office space in the world, along with Tokyo, Hong Kong, Zurich and Geneva.

Further good news for London office space providers is that in the second half of last year office space rental showed an increase from the previous six months. During the last three months of 2011, office space take-up in London reached three million square feet. Office space availability in London dropped by nine percent over 2011.

For further information and to read the full report please go to DTZ.

Additional information on commercial property, real estate, Central London’s exclusive office centres, setting up your first office and renting versus buying office space.