The term TMT is outdated...we need a new moniker, DAMIT!

I think the short answer is yes. Even the most optimistic agent will assume a softening of demand at some point, but for the foreseeable future, the TMT sector is going to have a key role to play for London.

So, I think it is clear that we all need to fully understand this sector if we are going to have any chance of ensuring central London’s office space offers appropriate accommodation in the coming years.

With that in mind, I find it surprising that we persist with the ‘TMT’ label. It is at best outdated, at worst lazy.

The term was coined by real estate advisers at a time when central London take-up was dominated by financial services, and TMT was a relative fringe player.

Under the ubiquitous TMT moniker, some include everything from tech giants Google or Microsoft to fast-growing tech startups, graphic design companies, PR consultancies, media buyers, advertising agencies, marketing professionals… the list goes on.

It is not so much grouping apples and oranges, as grouping half the fruit bowl under one heading.

At the risk of stating the obvious, companies across the TMT spectrum have vastly different requirements in terms of the space they want to occupy.

The stripped-back, quirky warehouse-type space that is often associated with TMT occupiers probably does not work for a mature telecommunications corporate, for example.

Similarly, a small but fast-growing advertising agency would find the rents and terms prohibitive at a new grade-A office building.

The creative industries continue to be the driving force in how London is evolving, in both where and the way that people work. We must find a new means of describing the sector that acknowledges the wide variety of companies we are talking about.

At Farebrother, we have discarded the term TMT in our analysis of Midtown and the South Bank and have instead coined ‘DAMIT’, recognising five sub-sectors: design; advertising, marketing and PR; media; internet; and telecommunications and technology.

Here is why. Taking the South Bank first, top-line analysis of office take-up over the past three years shows almost half - 46% - was let to TMT companies.

However, breaking this down into the DAMIT sub-sectors gives us a much more accurate picture. Media is the leading sector in terms of take-up, accounting for 19% over the period, buoyed of course by News UK moving into 1 London Bridge Street.

What is interesting to us is the clustering of media-related companies, with advertising, marketing and PR accounting for an additional 15% of take-up.

Indeed, these effectively now form a line along the river frontage, with the South Bank beginning to stake a claim as one of Europe’s media hubs.

The same analysis is equally revealing in Midtown. Again, at first glance it is easy to assume TMT is driving leasing activity in Midtown, with up to 40% of take-up attributable to this sector over the same three-year period.

However, using the DAMIT model, it is clear that the leading occupiers of space in the market are internet companies, accounting for 13% of take-up. This is interesting as it tells us that a relatively footloose sector is choosing to settle in Midtown, ahead of locations such as Covent Garden or the City fringe.

Technology and telecommunications companies - which we most readily associate with the TMT acronym — account for just 4% of take-up. Three times as much space has been let to professional services companies in the same period, which have long been a mainstay of the Midtown market.

It would be fascinating to see this model applied across central London; I think we would get a much more detailed ‘heat map’ of the types of companies that make up the city. Then, we would better understand the types of office space we should be delivering, and where.

I am sure there are many ways we can slice and dice TMT, but I am of the opinion that the moniker has outlived its usefulness and we need to consider a new means of examining take-up across London.

Julian Hind is a partner at Farebrother