Property has been a good investment for a long time as prices typically increase year after year. Occasionally there is a drop in prices for a variety of reasons, most recently due to the recession however long term trends show that prices always increase and therefore property is a sound investment.
Areas like London are particularly popular as there is a huge shortage. London is limited by space so it isn’t a case of simply building more properties. Developers have begun building taller buildings to accommodate the growing demand for both commercial and residential properties but developers can’t keep up with demand.
The tough economic climate has made businesses evaluate their spending and reduce costs where they can. Commercial property is particularly high in London and many businesses have downsized in order to save costs. Many hire meetings rooms on an ad hoc basis now rather than owning their own.
London is the most expensive city for both residential and commercial property according to a recent study by Paul Statham, CEO of Condeco, who found the UK to be one of the most expensive places to own commercial property. Companies spent $700bn on real estate in 2014 and given that the economy is improving, this figure is likely to rise above pre-recession levels of $1tn dollars in the next few years.
“With the economy starting to emerge out of recession, the cost of commercial real estate is forecast to continue to spiral and businesses will still haemorrhage money unless they have access to the facts about how efficient their office space usage actually is,” said Mr Statham. He went on to say “the most worrying aspect of this is that businesses are not aware of the extent to which their office space is under-used or their meeting rooms left empty, and it is large corporates, who own vast amounts of real estate across many cities and countries that experience this pain more than anyone else.”
Mr Statham predicts that the cost of office space in London is set to rise saying “a major trend for fast-growth multi-national companies right now is the leveraging of USPs within their workplace, such as collaborative spaces, in order to attract and retain the world’s best talent. A flexible workspace, geared to the daily demands of evolving business will not only work towards supporting better employee engagement and satisfaction, but also seriously enhancing productivity,” he adds.
Emily Falconer from No. 4 Hamilton Place, an events venue providing meeting space in London, said “Businesses are evaluating costs and some have downsized their office space. Many businesses have come to realise that they don’t have to have their own meeting rooms and instead are choosing to hire them on an ad hoc basis in order to keep costs down. You only really need your own meeting room if you have regular meetings and can make use of it, otherwise it is often more cost effective to hire one on an ad hoc basis.”
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Website: http://www.4hp.org.uk