London office developments at risk
Property Consultant E C Harris has warned that office developments in the City of London could stall as the eurozone debt crisis affects tenant demand and funding.
The report shows that the ‘notional’ London office development pipeline contains 150 potential projects ready to delivery 53 million square feet of office space by 2016, with a construction value of £12bn. However, difficulty securing pre-let tenants and external funding means many may not materialise.
These projects are driven by a growing shortage of high-quality office space, however the eurozone crisis is forcing tenants to stay where they are and ride out the storm. Some are opting for refurbishment of existing space rather than newly built offices.
Richard Taylor, head of commercial development at E C Harris said, “What the crisis has done is put doubt in people’s minds. Tenants are getting nervous – from media to solicitors – about pre-lets.”