In an encouraging development, office construction work is up by 4 per cent over the past six months in Central London, one of the global property hotspots, according to a latest survey carried out by Deloitte Real Estate.
The “London Office Crane Survey Winter 2016” reveals that the construction activity in Central London is at an eight-year high creating 14.8 million sq ft of office space. The central office markets covering the City, West End, Docklands, King’s Cross, Midtown, Paddington and Southbank and emerging submarkets, such as, Vauxhall-Nine Elms-Battersea, White City and Stratford, witnessed 40 new schemes totaling 2.8 million sq ft of office space.
Interestingly, 41 per cent of the space under construction is already let to tenants. The financial sector continues to lease the most space under construction in Central London. The survey found out that refurbishments are propelling the construction activity, accounting for nearly 70 per cent of the new construction activities.
The survey provides a promising outlook with the peak in delivery of new space being shifted to 2019 and beyond. The developers, however, are optimistic, as they see tenant demand as the top-most contribution that could potentially impact construction in the future. The downside is that construction costs are expected to rise further in 2017. But at the same time, a new era of intelligent buildings is set to unfold.
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The volume of office construction has increased by 4% over the past six-months to 14.8 million sq ft, an eight-year high